Preamble

The House met at half-past Two o'clock

PRAYERS

[MR. SPEAKER in the Chair]

PRIVATE BUSINESS

PLYMOUTH MARINE EVENTS BASE BILL

Order for Third reading read.

To be read the Third time tomorrow.

ROYAL BANK OF SCOTLAND BILL (By Order)

Order read for consideration of Lords amendments.

To be considered tomorrow.

BATH CITY COUNCIL BILL [Lords] (By Order)

Order for Third reading read.

To be read the Third time tomorrow.

GREATER MANCHESTER BILL [Lords] (By Order)

LUTON BOROUGH COUNCIL BILL [Lords] (By Order)

Read the Third time, and passed, with amendments.

Oral Answers to Questions — TRADE AND INDUSTRY

Post Office Closures

Mr. Tony Lloyd: asked the Secretary of State for Trade and Industry if, when he next meets the chairman of the Post Office, he will raise the closure of post offices.

Mr. Bruce: asked the Secretary of State for Trade and Industry whether he has recently discussed the criteria for closing sub-post offices with the chairman of the Post Office.

The Parliamentary Under-Secretary of State for Trade and Industry (Mr. David Trippier): My right hon. Friend has not recently discussed the criteria for closing post offices with the chairman of the Post Office and does not propose to do so.

Mr. Lloyd: Is the Minister aware that many people will consider that answer to be unsatisfactory because of the way in which the Post Office is using its position as a monopoly supplier in relation to the closure programme? Why are the Government prepared to intervene in the nationalised industries when to do so is to the public disadvantage, but not when such action would help the public?

Mr. Trippier: I compliment the hon. Gentleman in his persistence, because he had an Adjournment debate on the subject on 23 May. I do not think that he has any quarrel with the Government or with the Department of Trade and Industry. His quarrel is principally with his right hon.

Friend the Member for Chesterfield (Mr. Benn), who was responsible for setting up a Post Office Board with its own board of directors in 1969. It is interesting to note that when the Labour party was last in office it did not intervene once in any sub-post office closure.

Mr. Bruce: Will the Minister nevertheless recognise that the criteria applied by the Post Office to sub-post office closures are unsatisfactory because they do not take account of the wider implications, such as their importance to local communities and the fact that the presence of a sub-post office in a local shop can mean the difference between that shop surviving and closing?

Mr. Trippier: The criteria that are used by the Post Office in deciding whether to keep open or to close sub-post offices were discussed at great length in the debate which took place on the Floor of the House on 23 January. Much more lenient criteria are applied to rural sub-post offices.

Mr. Conway: My hon. Friend will be aware of the concern that has been expressed in Shrewsbury about a recent decision to close four sub-post offices. Bearing in mind the recent denationalisation of British Telecom and the responsibility for the provision of rural services placed on that now private company, is it not time that we reviewed the 1981 Act and the code of practice placed on the Post Office so that there is much wider consultation before sub-post office closures, perhaps with a better form of appeal?

Mr. Trippier: There is nothing wrong with the present system of consultation. I appreciate the concern about the proposed closure of some sub-post offices in my hon. Friend's constituency. I am sure that full advantage v/ill be taken of the appeals procedure as it now stands, it may be of comfort to him to know that 10 per cent, of appeals are successful.

Sir Anthony Grant: I appreciate the constitutional relationship that exists between the Government and the Post Office, but is there a remote chance that perhaps on a social occasion, quite informally, Ministers might raise not only the subject of the closure of sub-post offices but the possibility that at some time in the future first-class post might arrive in somewhat less than three days from the date of posting?

Mr. Trippier: If my hon. Friend has a specific example of mail, especially first-class mail, being delayed, I should be grateful if he would bring it to my attention, and I, in turn, will draw it to the attention of the Post Office Board.

Mr. Ewing: Is the Minister aware that his statement that the Labour Government did not intervene over post office closures is grossly inaccurate? My right hon. Friend the Member for Glasgow, Rutherglen (Mr. MacKenzie), who is present in the House, intervened when Sir William Ryland was chairman of the Post Office Board and stopped it from closing post offices. The Minister ought to correct the misleading impression that he has given. Is he further aware that the Post Office's problem was created for it by the Government, who reduced its external financing limit and caused the closure of 5 per cent, of post offices? The Government were responsible for that policy, and the Minister ought not to shirk that fact.

Mr. Trippier: I do not disagree with the hon. Gentleman's point about the way in which his right hon.


Friend the Member for Glasgow, Rutherglen (Mr. MacKenzie) intervened. He did so under the general powers in section 11(2) of the Post Office Act 1969, which states that he has power to intervene on matters of a general character for remedying
a defect in the general plans or arrangements of the Post Office
for exercising any of its powers.
A particular closure decision cannot be regarded as a
general plan or arrangement.

Floating Exchange Rates

Mr. Knox: asked the Secretary of State for Trade and Industry how many individuals and how many organisations have made representations to him in favour of floating exchange rates in the past 12 months.

The Minister for Trade (Mr. Paul Channon): None, Sir.

Mr. Knox: Does my right hon. Friend agree that international trade was facilitated and that the British economy worked much better when there were fixed exchange rates? What steps are the Governnent taking to encourage greater order in international exchange rates? To that end, when will Britain join the exchange rate mechanism of the EMS?

Mr. Channon: As my hon. Friend knows, the exchange rate mechanism of the EMS is not a system of fixed exchange rates. There have been fluctuations in the exchange rates between European currencies and the dollar. Of course all of us, especially exporters, would like a more stable exchange rate, but it is impossible to imagine that there could be a system of fixed exchange rates without enormous pressures on currencies when the rates become substantially out of line with true market values.

Mr. Meadowcroft: How far would European financial stability assist this country in competing effectively with the United States of America?

Mr. Channon: As I said to my hon. Friend the Member for Staffordshire, Moorlands (Mr. Knox), in the last few months there have been enormous fluctuations in the exchange rates between European currencies and the dollar. We should not avoid that problem by joining the EMS.

Mr. Dorrell: Is it not important to do everything that we can to limit those movements? Is it not unrealistic to expect an expansion of trade in manufactured goods across international frontiers if we cannot tell from one month to the next what revenue we shall receive for given export orders because of fluctuations in exchange rates?

Mr. Channon: I understand and share my hon. Friend's concern about the problems faced by exporters, but it is not just this country which finds itself in that position. Every other country has the same system of floating exchange rates. We must try to obtain greater market stability by encouraging sound monetary and fiscal policies, not only in this country but in many others. That was one of the aims of the recent international summit.

Mr. Gould: Does the Minister accept that there is no such thing as a clean float and that one of the dirtiest elements is the current level of interest rates, which in the last six months has helped to push up the pound against the yen by over 6 per cent, and against the deutschmark

by nearly 5 per cent.? Does the Minister think that loss of competitiveness of that kind is helping British business men who are trying to sell in international markets?

Mr. Channon: It is impossible to please the whole House on this issue. Whatever the rate of the pound may be, the Opposition will criticise it. The real point is that it is impossible to move against market pressures on any one currency if those pressures are sufficiently strong. It is an illusion to imagine that fixed exchange rates can work in a situation of that kind. We saw what happened when the Labour Government tried to operate such a policy.

Businesses (Departmental Assistance)

Mr. Richard Page: asked the Secretary of State for Trade and Industry what assistance his Department now provides to Business in the Community and to local enterprise agencies.

The Secretary of State for Trade and Industry (Mr. Norman Tebbit): In the current financial year Business in the Community is receiving a grant of £75,000, and £175,000 has been allocated for support of local enterprise agencies on a pump-priming basis.

Mr. Page: I thank my right hon. Friend for those figures. Is he aware that not only has Business in the Community helped to set up many successful small businesses, but that it has helped to prevent one or two ill-conceived ventures from going ahead, thus avoiding the pain and the distress that would have been caused when the crunch eventually came? May I ask my right hon. Friend to build upon that success by asking the British Overseas Trade Board to liaise more closely with local enterprise agencies in order to encourage the enterprising smaller firms to become more involved in exports?

Mr. Tebbit: Certainly. My hon. Friend has made two good points. The Department's regional offices cover BOTB regional services. They have, of late, been increasing their links with the local enterprise agencies, and we have encouraged them to use the whole of the Department's services. We have also been making presentations on exporting to local enterprise agencies and to other organisations gathering small firms together. That is why, I think, some 75 per cent, of BOTB users are, indeed, small firms.

Mr. Lofthouse: Has the Secretary of State any plans to assist those mining communities which are about to lose their pits, which are their only source of employment? Has he any plans to assist areas such as mine?

Mr. Tebbit: I should be happy if local enterprise agencies were formed in such areas. The concept of the local enterprise agency is that it should be a community, and predominently private-sector, based organisation, although of course a good deal of the funding comes from local authorities and central Government. In addition to my Department's spending, the Department of the Environment contributed £843,000 last year through the urban programme, while the Development Commission contributed £12,000. The Welsh Office contributed £150,000 through the urban aid scheme and the Welsh Development Agency contributed £34,000. Furthermore, the Scottish Development Agency has contributed £280,000. In several areas where there are problems associated with pit closures, funding is clearly therefore


available for local enterprise agencies. I hope that some of them will be of help to those setting up in business in such areas.

Mr. Maclean: Is my right hon. Friend aware that in its first 18 months of operation Business Initiatives Carlisle, a local enterprise agency, helped to create more than 100 small businesses with more than 200 jobs? Does he agree that although his investment of £175,000 in local enterprise agencies is most welcome, it is desirable to give yet more resources to such agencies, because helping successful organisations, such as BIC, is one of the best investments for creating jobs that the Department can make?

Mr. Tebbit: I appreciate my hon. Friend's comments. However, one of the keys to the success of local enterprise agencies is that they have not become the mere creatures of Government but have very live and valuable support from local industry. It is local industry that benefits most from supporting other parts of local industry. Therefore, it is essential to ensure that funding is predominantly of a local nature.

Mr. Wriggles worth: I welcome the Secretary of State's support for Business in the Community and local enterprise agencies, but will he say something about the future of the Department's small firms service? Is he aware that many small businesses welcome the service provided by his Department? Has the right hon. Gentleman any plans to pass it over to the agency or to other parts of the private sector, or to close it?

Mr. Tebbit: The Department is extremely interested in continuing with its support for small businesses. That is, not least, why we are very active in pursuing policies that are directed towards removing the burdens of Government from small businesses. That is something that is best done through the Government, not through any other agency. Thus, whatever happens, we will remain extremely active in our support for small businesses.

West Midlands (Regional Assistance)

Mr. John Mark Taylor: asked the Secretary of State for Trade and Industry how many applications for regional assistance have so far been received in the newly designated assisted area in the west midlands.

The Minister of State, Department of Trade and Industry (Mr. Norman Lamont): Up to 24 May, 369 applications for assistance had been received by the Department's west midlands regional office.

Mr. Taylor: I thank my hon. Friend for that encouraging reply. Perhaps I could put to him the equally important question: is he satisfied that west midlands industry has been adequately informed about the range of assistance available under regional aid so that it might not say that it has not been given sufficient information?

Mr. Lamont: That is unlikely, as we have received more than 7,000 inquiries about regional selective assistance since the scheme's inception. Indeed, in case of doubt, we have gone out of our way to advertise such services, with about 40 seminars, which have been attended by more than 4,000 business men. My hon. Friend might like to know that the inquiries received by the Department and those that have become firm

applications are equal to £100 million of expenditure— that is, grants of £11·8 million—which would create or safeguard about 7,400 jobs.

Mr. Winnick: Is the Minister aware of the large-scale redundancies and closures in the west midlands and the fact that, apart from Northern Ireland, that region now has the largest percentage of people unemployed for longer than 12 months? When will the Government recognise the tremendous harm that they have done to the west midlands by their disastrous economic policies? The people of the west midlands want to be able to earn their own living again, but there is no sign that such a policy will come from this Government.

Mr. Lamont: The Government have done two things. First, they have categorised parts of the west midlands as assisted areas. I have given information that shows that potentially there is a great deal of help available for firms in those areas.
Secondly, through their support of British Leyland, the Government have put a great deal of money into supporting not only the motor industry in the west midlands but those who supply it.

Mr. Brandon-Bravo: When dealing with the applications, will my hon. Friend ensure that they are not simply transferring existing jobs from one part of the country to another? Has he considered the possible inadvertence of enabling a foreign manufacturer to reduce his surplus manufacturing capacity at marginal cost by assembling in this country? Will he look carefully at the activities of the Sprick Corporation of West Germany and the possible adverse effects on TI Raleigh in my constituency?

Mr. Lamont: Obviously I shall consider the case my hon. Friend mentioned. When giving selective assistance to foreign investors in Britain, one of the major factors that we take into account is the impact on existing firms. Therefore, that is already part of the system.
On the point about transferring jobs, my hon. Friend will know that as a result of our review of regional policy we have tightened the criteria to reduce the element of job shuffling.

Mr. Geoffrey Robinson: On the question of Government aid to the west midlands, I am sure that the Minister is aware of the critical decision at Talbot, given the hold-up of payments on the Iran contract. Is he aware that with the barter trade arrangements, which we know are notoriously difficult, complex and at a difficult stage, the collapse of the Iran contract could prejudice the whole of the Talbot operation in the west midlands, with 10,000 jobs at stake? If his Department is not already active, will he consider taking an initiative to resolve the problem?

Mr. Lamont: I assure the hon. Gentleman that I am extremely involved in that matter. We are well aware of the position and are doing everything that we can to help.

British Leyland

5. Mr. Strang: asked the Secretary of State for Trade and Industry if he will make a statement on the Government's future commitment to British Leyland.

Mr. Tebbit: The Government remain committed to the restoration of BL to commercial viability.

Mr. Strang: Is the Secretary of State prepared to go down in history as the saboteur of Britain's only major indigenous motor manufacturer? Does he admit the accuracy of the report in today's Financial Times that Austin Rover is to be forced to rely on Honda engines, which, combined with the privatisation of Jaguar and the proposed privatisation of Unipart, make industrial sense only if the Government are planning to facilitate the eventual takeover of BL by Honda or some other multinational?

Mr. Tebbit: The answer to the hon. Gentleman's first question is no. The answer to his point about the article in the Financial Times is that I have no intention of commenting upon an article that is a sort of bouillabaisse — a fishy stew; a mixture of truth, half-truth, inaccuracy and downright untruth.

Mr. Spencer: Before my right hon. Friend commits further sums of public money to BL, will he fully satisfy himself that it has learnt the first rule of business—that the customer is always right?

Mr. Tebbit: Yes; and I am of the opinion that that lesson has been well learnt.

Mr. Williams: Does the Minister realise that if he were as ready with decisions as he always is with insults, BL would not be waiting after six months and the British Steel Corporation would not be waiting after 11 months for decisions about their futures? Does he accept that this inexcusable dither and delay by himself and his Department is damaging BL and that the uncertainty is stimulating and provoking the very type of speculation —I hope false—that we have seen in the newspaper that used to employ the right hon. Gentleman? The standards there have not changed at all. Is not this speculation destroying the morale that has been carefully built up during BL's recovery period? Is the right hon. Gentleman aware that if there is any truth in the proposition that BL is to be forced to drop engine production and to buy Japanese engines, so giving up high value skilled work in exchange for low value Meccano assembly operations, that will trigger off a massive storm not only in the west midlands but throughout the car and components industries?

Mr. Tebbit: I have to say of my employer of some 30 or 40 years ago that the standards seem to have gone down as the pay has gone up. I take note of what the right hon. Gentleman says. However, although we received the original corporate plan for BL some months ago, at a late stage in our consideration of the plan, BL and Honda put to the Government some important proposals for collaborative projects. That changed the nature of the corporate plan. It is not unreasonable that we should have given extremely close consideration to those proposals. We are now nearing completion of our scrutiny of the corporate plan and the proposed further collaborative arrangements with Honda. I hope that I shall be able to announce our conclusions shortly.

Mr. Forth: Can my right hon. Friend assure the House that, at this stage in his deliberations, he fully appreciates the crucial importance of the continuation of engine production by motor manufacturers, such as the Austin-Rover group, to their viability as full-scale manufacturers, and the key importance to the west midlands of that production?

Mr. Tebbit: I fully undertstand what my hon. Friend says, but, having been firm in what I said to the right hon. Member for Swansea, West (Mr. Williams) about the fact that I shall announce our conclusions shortly, it would be wrong if I commented by way of half statements on bits and pieces of the proposals before us.

Mr. Wrigglesworth: Even in advance of that statement, can the Secretary of State agree that it is vital for the whole of the British industry and economy that we retain the volume production of cars at British Leyland? Will he give a pledge that he will do everything in his power to sustain the volume production of cars, which can be done only if engine production is continued?

Mr. Tebbit: I am anxious to ensure the success of BL from every point of view. I am conscious of the fact that motor cars that appear to the consumer to be British have had some foreign production. For example, on average, about half of a Ford motor car is British, about a third of a GM Vauxhall is British, and over 90 per cent, of a BL car is British. Therefore, we have a clear interest in that and also in the fact that BL is a British car exporter, alongside Jaguar, although on a different scale. We are acutely conscious of BL's importance in the British industrial scene.

Mr. Dalyell: asked the Secretary of State for Trade and Industry what discussions he has had with BL on the future of the commercial vehicles industry.

Mr. Norman Lamont: The prospects of BL's commercial vehicles business are covered in the company's annual corporate plan.

Mr. Dalyell: What can Her Majesty's Government do to assist the continuation of commercial vehicle manufacture in Bathgate?

Mr. Lamont: As the hon. Gentleman knows, the decision about Bathgate has been made and, unfortunately, that decision will not be changed. As regards assistance to the area and alternative uses for the plant, my right hon. Friend the Secretary of State for Scotland is obviously prepared to view sympathetically applications for alternative use of the plant, or bits of it. As the hon. Gentleman knows, the travel-to-work area is a development area and therefore qualifies for the highest level of assistance.

Skill Shortages

Mr. Latham: asked the Secretary of State for Trade
and Industry what representations he has received from
industrialists about pressures on output through difficulties
in recruiting skilled or semi-skilled labour in recent
months.

Mr. Channon: My Department has received a number of such representations, notably but not exclusively in the area of information technology.

Mr. Latham: In view of the concern expressed by knitwear firms in Leicestershire recently, will my right hon. Friend undertake to have discussions urgently with the Department of Employment to see what can be done to deal with the problems and in particular to encourage recruitment and training?

Mr. Channon: I agree with my hon. Friend and I shall do that. I know that as a result of his questions to my right


hon. Friends a special Manpower Services Commission investigation is taking place. My hon. Friend has raised a very important issue.

Mr. Eastham: May I remind the Minister that British industry does not compare with its foreign competitors in investment in training for skill shortages? Is he aware that France invests twice as much as Britain, and that in America six times as much is being spent on training? Is it not time that the Minister got in touch with industrialists, shook them and told them that they have responsibilities to provide trained personnel?

Mr. Channon: I agree that industry has responsibilities. If the hon. Member is talking about Government expenditure on training, I am surprised to hear what he says. After all, total expenditure has risen from £380 million in 1979 to £1·2 billion in 1985–86. That does not seem to me to be a reduction but rather an enormous increase and something that the whole House will welcome.

Mr. Cockeram: Is it not a criticism of schools and technical colleges that employers have so much difficulty in finding suitably qualified personnel? Has the Minister seen in the Daily Telegraph every Thursday 10 to 14 pages of advertisements for technically qualified staff? Is he aware that employers continually complain that they cannot get suitably qualified applicants?

Mr. Channon: That is one of the reasons why my right hon. Friend has authorised a substantial contribution of £12·5 million from the budget of the Department of Trade and Industry towards the package that has been made available to provide additional places in higher education for students in engineering and technology.

Mr. Ashdown: Is it not the case that this autumn, as last autumn, there will be a significant number of unfilled vacancies in apprentice training establishments, both in the public and in the private sector, because firms cannot afford to fill those places? In that case, will the Government urge the Manpower Services Commission to fill those places at public expense so as to overcome the skill shortages that are affecting British industry?

Mr. Channon: The hon. Member has raised a number of very important points that are primarily the responsibility of my right hon. Friend the Secretary of State for Employment. I must reiterate that expenditure on training is high. Special steps have been taken in higher education as well. I am sure that my right hon. Friends, and the Secretary of State in particular, are doing everything in their power to increase the amount of expenditure on training.

Mr. Holt: Does my right hon. Friend agree that while it is essential to train as many people as possible, there is a vast reservoir of trained and skilled people who are unemployed? Is he aware that the main reason why they are unable to find jobs is that they cannot find anywhere to live, however far they ride on their bicycles? Is he further aware that it would be a saving for the Government and the country if my right hon. Friend could ask the Secretary of State to suggest in Cabinet that, when a man has been unemployed for six months, the Government might give him an advance of another year's unemployment benefit as a deposit on a house in another

part of the country, allowing him to fill a skilled job, thereby saving the unemployment costs and improving the efficiency of the country?

Mr. Channon: My hon. Friend has raised a very interesting point. I shall certainly make sure that my right hon. Friend the Secretary of State for the Environment is aware of it.

Mr. Williams: Does the Minister agree that it is to be deplored that the Government, through the trebling of company liquidations and the destruction of manufacturing industry at double the rate of our European competitor countries, have created conditions in which, even if there were world growth, Britain could not obtain its fair share because we no longer have enough industrial capacity? Does he not recognise that even more grotesque is the fact that, even with the present limited level of growth, many sections of British industry cannot take full advantage of it because of skill starvation? That is the direct result of the Government's blind destruction of the skill training system that they inherited.

Mr. Channon: The right hon. Gentleman churns out that gush at every Question Time and it is no more valid today. The growth in the British economy this year is likely to be the highest in western Europe, and certainly the highest in the European Community. The economy is expanding. Training is a problem, but the Government, as the figures show, have done their utmost to try to provide more money. As has been said industry also has a responsibility for training.

Rates

Mr. Favell: asked the Secretary of State for Trade and Industry what representations he has received about the effect of rates on trade and industry.

Mr. Norman Lamont: A number of representations have been received from various bodies on behalf of industry and from individual business men expressing concern at the adverse effects of rates increases on industry.

Mr. Favell: Is my hon. Friend aware that Stockport and Manchester are next door to each other and that there is not a blade of grass between the two? Is he aware that the rates in Stockport are two thirds those of Manchester, that Stockport has half the number of local authority employees per head of population and that at the height of the recession, between 1977 and 1981, employment went up in Stockport by 4 per cent, when in Greater Manchester as a whole it went down by 9 per cent.? Does he draw any conclusions from that?

Mr. Lamont: My hon. Friend makes a good point. I am not sure that I need to underline his conclusions. Obviously, rates increases cost jobs. Perhaps he should send a copy of his question to right hon. and hon. Members on the Opposition Front Bench.

Mr. Crowther: Is the Minister aware that in my constituency the rates levied on industry and commerce could be at least 30 per cent, lower if the Government of which he is a member had not progressively reduced the rate support grant year by year? Will he therefore make representations in appropriate Cabinet circles for the terrible rate burden to be reduced by restoring the rate support grant to its former level?

Mr. Lamont: The hon. Gentleman's assertion would be more convincing if local authorities elsewhere in the country had not managed to combine a reduction in the rate support grant with modest rate increases. If empty buses did not travel half the night through Sheffield, the rates there would be a lot lower.

Mr. Teddy Taylor: Can my hon. Friend explain to hard-pressed employers in Southend, who pay a lot in rates despite the excellent prudence of the splendid Southend borough council, why they should pay quite so much when the agriculture industry makes no rates contribution whatsoever?

Mr. Lamont: Fortunately, I am not responsible for The Times this morning, the Department of the Environment or for agriculture so I shall pass on that question.

Mr. Andrew F. Bennett: Does the Minister accept that the hon. Member for Stockport (Mr. Favell) has his facts wrong, because there is a considerable area of grass between Stockport and Manchester? The biggest problem is that for years Stockport has neglected many of its old council houses. Is the Minister aware that, like the hon. Member for Stockport, I should like them to be modernised? Is not the problem that such modernisation involves local government expenditure, not only in money but in staff, to ensure that the work is done?

Mr. Lamont: Yes, but other local authorities have absorbed cuts in the rate support grant. Local authority expenditure in England has been rising by about 8 per cent, in real terms. There is no reason why people should expect to be subsidised by the general taxpayer in that respect.

British Leyland

Mr. Roy Hughes: asked the Secretary of State for Trade and Industry if he has had any recent discussions with the chairman of BL concerning future investment.

Mr. Tebbit: Yes, Sir.

Mr. Hughes: When will the Secretary of State realise that unemployment is now the principal concern throughout the country? Will he bear in mind that the motor industry is a major employer of labour, and therefore that new investment is vital? Does he agree that without it we shall hear further redundancy announcements such as that recently made by the Girling company in South Wales?

Mr. Tebbit: I am able to assure the hon. Gentleman that I am aware of all those matters and, of course, as he will be aware, the number of people in work in the United Kingdom has been increasing since the first quarter of 1983.

Mr. Geoffrey Robinson: I think that all hon. Members will have been reassured by the measured and constructive tone in which the Secretary of State has spoken of the importance to the whole of Britain—the components industry, the capital goods industry—of British Leyland, but we are looking to him now to put his money where his mouth is. In that respect, can he confirm that he shares the view that an essential part of British Leyland to play will be in the continued manufacture of the power train— engine and gearboxes—in this country, and will he back the Austin Rover new engine project?

Mr. Tebbit: I have to say to the hon. Gentleman that, if it comes to a question of money and mouth, he should

recollect that since this Government have been in office we have directly contributed something like £1·2 billion to the restoration to viability of British Leyland. Beyond that, I would advise him not to go too far in praising me —it might upset his hon. Friends. I hope that I shall be able to make a statement before too long which will please all those of a constructive frame of mind.

Local Investment

Mr. Meadowcroft: asked the Secretary of State for
Trade and Industry whether he will have discussions with
representatives of local enterprise boards and of industry
with a view to securing a co-ordinated approach to local
investment.

Mr. Trippier: I frequently meet representatives of local and national bodies concerned with investment in industry, including local enterprise agencies.

Mr. Meadowcroft: Is the Minister aware that there will be a wide welcome in the House for the more constructive Government and business attitude towards the local authority enterprise boards? Will he accept the need for better co-ordination to give prompt help to new and expanded businesses? Can he give the House any assurance of the future of the West Yorkshire enterprise board and about its urgent need for further capital resources?

Mr. Trippier: The hon. Gentleman makes a very important point. It is essential that I should stress that local enterprise boards, as opposed to enterprise agencies, are companies limited by guarantee and not directly affected by the Local Government Bill currently before the House. I understand that West Yorkshire county council has asked for consent for funding of the enterprise board to a sum of £2 million in 1985–86, and that that is currently before my right hon. Friend the Secretary of State for the Environment. The hon. Gentleman may be aware that I am constantly trying to encourage the use of local enterprise agencies such as the Leeds business venture, with which I know he is very familiar, as a signposting service and as a one-stop shop. I think that that excellent enterprise agency is in a very strong position with regard to acting as a co-ordinator in getting small firms financed. That will speed matters up and, I hope, remove many of the obstacles and the confusion which the hon. Gentleman has identified in his question.

Mr. Haynes: I listened to what the Minister had to say, but he is not doing very well, is he? He visited a particular boat-building firm in my constituency and made certain promises, and then let it down. Why have these exhibitions been cancelled?

Mr. Trippier: I must confess to the hon. Gentleman that I have not the slightest clue what he is talking about.

Small Firms (Public Contracts)

Mr. Hind: asked the Secretary of State for Trade
and Industry whether he has any plans to seek to increase
the level of public procurement placed with small firms.

Mr. Trippier: Contracts must be won on merit, irrespective of company size. However, we recognise that small firms often face particular difficulties in seeking public sector business, and we shall continue our efforts to reduce these.

Mr. Hind: Is my hon. Friend aware that one major problem for small firms is obtaining the details of proceedings in tendering for Government contracts? Can he tell us whether he has taken any measures to improve that situation and what he can do to assist those small firms?

Mr. Trippier: Only yesterday I published a new booklet entitled "Tendering for Government Contracts", aimed at helping small firms to sell to Government Departments. The booklet describes the types of goods and services that Government Departments buy, and explains how to apply and whom to approach in the major purchasing Departments. Obviously, I hope that it will be widely used.

Mr. Campbell-Savours: Does not the existence of 10 major defence research establishments in the south and south-east of England have a major effect on procurement policy for small high technology companies in the south of England? Does it not put such companies in the south at an advantage? Why cannot we have the same advantages in the north? Why cannot some of those defence establishments be moved to the north of England, bearing in mind all the spin-offs that they have for the information technology industry?

Mr. Trippier: It will probably interest the hon. Gentleman to hear that only this morning I was looking at the number of research establishments in both the public and the private sectors. It will perhaps come as a surprise to him, since he comes from the same region as I do, to discover that we in the north-west have a very fair share of the research establishments available north of Watford.

Mr. Bellingham: Although I welcome the booklet and the obvious benefit that it will bring to small businesses, may I ask my hon. Friend what effect it will have on public procurement generally?

Mr. Trippier: The most important development to have arisen out of the Government purchasing lead that we have taken in the Department of Trade and Industry is that it will encourage the use of interdepartmentally approved lists. Certainly it will improve the standarised procedures affecting small firms. I announced last May that tenders for most Government contracts worth less than £10,000 would be exempt from the normal procedures. That should help small businesses to obtain a share of those business opportunities.

Mr. Robert C. Brown: The Minister spoke about his researches this morning. Is he aware that the northern region of England has the highest unemployment in mainland Britain and is the only region of mainland Britain without a Government-backed research and development agency? Is it not high time that we had such an agency in the north?

Mr. Trippier: The problems of the northern region were recognised in the legislation on regional policy approved by the House last year. In that we said that we-would concentrate—

Mr. Campbell-Savours: Cuts.

Mr. Trippier: The hon. Member for Workington (Mr. Campbell-Savours) talks of cuts. I had better tell him that his hon. Friend was referring to the northern region and not the north-western region. Some 97 per cent, of the working population in the northern region were assisted

before the changes in regional policy, and the same percentage of people are assisted. In the north-west the numbers of people living in assisted areas have increased as a result of the legislation to which I referred. I am aware of the problems identified by the hon. Member for Newcastle upon Tyne, East (Mr. Brown), and recently we have received a report from Newcastle university entitled "The Location of R and D in Great Britain." We shall study that, and it will be taken into account in formulating future policy.

Manufacturing Trade

Mr. Teddy Taylor: asked the Secretary of State for Trade and Industry what was the United Kingdom's surplus or deficit in manufacturing trade with the European Economic Community and the rest of the world, respectively, in the most recent annual period for which figures are available.

Mr. Channon: In the 12 months ending March 1985 there was a deficit on trade in manufactures with the other members of the Community of just under £8 billion. With the rest of the world there was a surplus of £3·5 billion.

Mr. Taylor: In view of this horrific trade deficit with the Common Market, which is equivalent to a loss of 800,000 British jobs, does my hon. Friend agree that there is an urgent need for a full-scale inquiry into why our trade with the Common Market is so appalling and why, according to an answer that my hon. Friend gave me the other day, our share of the Common Market's market for manufactured goods is less than it was the year before we joined?

Mr. Channon: It is only rarely that I do not agree with my hon. Friend, but this is one of those rare occasions. He was a member of the Select Committee on Trade and Industry which examined this matter last year, and the Secretary of State replied to its report a year ago. I must point out that 46 per cent., of British exports went to Community countries.

Mr. Roy Hughes: Answer the question.

Mr. Channon: I should love to answer the question if I were allowed to.

Mr. Speaker: Order. The hon. Member for Newport:, East (Mr. Hughes) should allow the Minister to answer.

Mr. Channon: It is essential to look at all the facts affecting our trading position and not take any one area or any one component of the trading figures in isolation.
I repeat that 46 per cent, of total British exports went to the Community last year, compared with 30 per cent, in 1970.

Mr. Sheerman: Perhaps the Minister will come down from the clouds of theory and look at real closures. I refer him to the closure of Philips in Brighouse and the impending closures of Philips establishments in other parts of the country, with the result that manufacturing capacity in washing machines, tumble driers and television sets is being taken back to Italy. What does the Minister intend to do about closures, which take more jobs away from us with every day that passes?

Mr. Channon: I am sure the hon. Gentleman welcomes the fact that in the last quarter the volume of our manufacturing exports increased by 12 per cent., which


was a great increase, and that our exports are running at extremely good figures. It must be good for British industry to be competitive, and to be able to export competitively and profitably.

Mr. Gould: Does the Minister accept that the House is intelligent enough to read both sides of the trading account? Bearing in mind that the Minister of State told the House on 1 May that every 1 per cent, increase in import penetration cost the country 250,000 jobs, what connection does the right hon. Gentleman now make between our record trade deficit with the European Community and the record unemployment that we must now endure?

Mr. Channon: The House must also understand that the United Kingdom is and has been in trade surplus for many years. That was not a factor—[HON. MEMBERS: "Oil."] Opposition Members attack whatever commodity suits them. [Interruption.] We have heard it all before. Many Opposition Members want us to leave it in the North sea. As hon. Members want to talk about manufacturing, let me tell them that Britain sends 39 per cent, of its exports of manufactured goods to the other Community countries, compared with 29 per cent. 15 years ago. That is a massive increase in exports of manufactures, and many thousands of British jobs depend upon it.

Bosporus Bridge Contract

Mr. Bowen Wells: asked the Secretary of State for Trade and Industry if he has raised with the general agreement on tariffs and trade the credit arrangements for the Bosporus bridge contract.

Mr. Tebbit: The arrangements for export credit operation involving elements of aid are handled under the consensus and development aid committees of the Organisation for Economic Co-operation and Development rather than under the GATT. The Government are currently exploring within those OECD groups the issues raised by the type of credit arrangements offered by Japan for the second Bosporus bridge.

Mr. Wells: Is it not unacceptable that the Japanese Government should put my right hon. Friend in the position of losing a major contract to the Japanese for bridge building although we produced the lowest contract price? Because of the use of subsidised export credits and trade in aid-type arrangements, the Japanese have won this major contract and, thus, are able to penetrate a market that was previously dominated by the British, with a consequent loss of jobs for the United Kingdom. Yet, the Japanese refuse to accept proper trade terms for the entry of our goods. Is it not essential that my right hon. Friend negotiates a watertight arrangement to put our manufacturers and exporters on the same basis as Japanese business men?

Mr. Tebbit: I well understand my hon. Friend's anxiety. As I said the last time when I answered questions on this matter, it does not appear that the Japanese broke any undertakings and agreements on aid. However— [Interruption.] If the House is finished, I shall continue. However, what I find—[Interruption.]

Mr. Speaker: Order. I seldom see the Secretary of State lost for words. Let him continue.

Mr. Tebbit: I am not lost for words, but I have no intention of shouting above this bear garden, and the sooner hon. Members stop shouting, the sooner we shall get on. [Interruption.]

Mr. Speaker: Order. Perhaps I should not have said that.

Mr. Tebbit: Of course you should have said that, Mr. Speaker. Mr. Speaker is always right.
The point about the Bosporus bridge contract, which I have sought to make both here and in discussions with the Japanese authorities, is that their dumping of cheap credit to obtain this contract is incompatible with the assurances and policies announced by Mr. Nakasone, under which the Japanese are seeking to limit their trade surplus. That matter is being taken up forcefully with the Japanese authorities, and unless they pay attention, before long other countries will take protectionist measures against them. I hope that they will draw back from the position into which they are getting before it is too late.

Mr. Gould: In the light of the predatory policies being pursued by the Japanese, and in the light of what the Secretary of State has just said, does he accept that this is hardly the time to contemplate unilateral disarmament in trade of the sort with which the Government seem to be flirting in the wake of the Byatt report? Will he listen to the views of the National Economic Development Office, published today, and of his Department's overseas projects board, and ensure that British firms which seek major contracts abroad are not left defenceless against the Japanese and other foreign competitors?

Mr. Tebbit: It is not my habit to flirt. When I get started, I get on with it.

Japan

Mr. Phillip Oppenheim: asked the Secretary of State for Trade and Industry how many representations he has received from British exporters about non-tariff barriers in Japan.

Mr. Channon: My Department receives a number of representations from British exporters about non-tariff barriers in Japan.

Mr. Oppenheim: Does my right hon. Friend agree that the failure to export to Japan is often attributable not to non-tariff barriers but to weaknesses in British companies? None the less, last year, the Japanese exported to us £40 million worth of telecommunications equipment, and in return we exported to them only 1 per cent, of that figure. Does he accept that that occurred because we have liberalised our telecommunications market and thrown it open to imports from abroad, while the Japanese have no such policy and close their doors to overseas telecommunications products?

Mr. Channon: My hon. Friend raises a fair point which, coupled with the points made by my right hon. Friend the Secretary of State in answer to the previous question, is an example of some of the practices of the Japanese Government that are getting the world trading system into a dangerous position. During his visit to Tokyo my right hon. Friend the Secretary of State raised my hon. Friend's specific point, and we shall continue to press the matter.

Mr. Willie W. Hamilton: asked the Secretary of State for Trade and Industry what further progress has been made in talks with Japan on the liberalisation of trade.

Mr. Channon: On 9 April, Prime Minister Nakasone announced a market-opening package of measures designed to bring about an increase in Japan's imports of manufactured goods, further liberalisation of internal financial markets and the internationalisation of the yen. We and our Community partners will be looking closely for evidence of practical steps to implement those intentions.

Mr. Hamilton: Is the Minister aware that the country is becoming increasingly angry about the courteous claptrap that we have heard from the Japanese in such matters during the past 20 years, and about the fact that no progress has been made? Does he accept that the House will give unqualified support if the Government take retaliatory action against the Japanese?

Mr. Channon: The feelings of the House are abundantly clear. However, it would be much more satisfactory and in the interests of Japan and the United Kingdom if the measures which the Japanese Prime Minister promised in July prove, in effect, to open the Japanese market to our exports. That would be a happier solution than having to take retaliatory measures, which would help neither the United Kingdom nor Japan in the long run. As my right hon. Friend the Secretary of State made clear, there is a grave risk of the world trading system falling into serious trouble and of retaliatory measures being taken.

Regional Policy (Tourism)

Mr. Adley: asked the Secretary of State for Trade and Industry what contribution he envisages tourism makes to regional policy, and vice versa.

Mr. Norman Lamont: Tourism can make a positive contribution to employment in assisted areas, and tourism projects in those areas may also qualify in certain circumstances for regional assistance.

Mr. Adley: As flourishing regional airports are fundamental to an effective regional policy and to the growth of regional tourism, will my hon. Friend give the House a categorical assurance that he will do all that he can to encourage the growth of traffic at regional airports outwith the south-east of England?

Mr. Lamont: I recall that my hon. Friend led previous opposition to Maplin and Stansted on regional policy grounds. In view of the statement that may be made in two minutes' time, this is a case of my not venturing where angels fear to tread.

Tourism

Mr. Greenway: asked the Secretary of State for Trade and Industry if he will make a statement on the prospects for the tourism industry in 1985.

Mr. Norman Lamont: In the first quarter of 1985 the number of visits to the United Kingdom by overseas residents was 10 per cent, higher than a year earlier, at a new record level for a first quarter. I am optimistic about the prospects for the rest of the year.

Mr. Greenway: Is it not true that a record number of jobs are being created in tourism, and that this service industry is one of the most promising areas for growth in employment? What was the value of tourism to Britain last year, and how many people were employed in the industry?

Mr. Lamont: Over 1 million people are currently employed in the industry. What my hon. Friend says about the prospects for growth in employment is correct. He may have noticed that we are now publishing, quarter by quarter, the growth in jobs in the tourist-related sectors. I hope that that will highlight the point that he is making.

Mr. Heffer: Does the Minister agree that while it is good to encourage tourism to underdeveloped areas such as Merseyside, it would be better if the Government concentrated on rebuilding industry in such areas in order to get the thousands and thousands of workers who are unemployed there back to work? Otherwise, we shall become a national museum.

Mr. Lamont: The hon. Gentleman has previously urged me to do more for tourism on Merseyside. We need to do things to help manufacturing and services, but we must face the fact that one of the best prospects for growth in employment lies in the services sector, and that includes tourism.

Mr. Ewing: On a point of order, Mr. Speaker.

Mr. Speaker: Does it arise out of questions?

Mr. Ewing: Yes, Mr. Speaker. The House is aware that the Prime Minister, who has fortunately just joined us, has told the nation that she has changed her style.
However, we have never been warned that the Secretary of State for Trade and Industry has changed his style. Could you do something, Mr. Speaker, to protect the House from the shock of the Secretary of State for Trade and Industry being nice to people, because if that goes on my hon. Friend the Member for Bolsover (Mr. Skinner) will change his style as well?

Mr. Skinner: Oh, no!

Mr. Speaker: Order. It is a consummation devoutly to be wished.

Mr. Skinner: Further to that point of order, Mr. Speaker. I too have noticed that the Prime Minister now has more voices than Janet Brown. Today, at Question Time, we have heard from the Secretary of State for Trade and Industry and he has been nearly as quiet as a tailor's dummy, but, I assure you, Mr. Speaker, I ain't changing.

Sudan (Famine Relief)

Mr. Michael Meadowcroft: (by private notice) asked the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on his action in the light of today's urgent warning of potential famine disaster in the Sudan.

The Minister for Overseas Development (Mr. Timothy Raison): We have been closely monitoring the serious food situation in Sudan. There are substantial supplies in Port Sudan. The problem is internal distribution. We are now providing £650,000 for the charter of a Hercules to be placed at the disposal of the Save the Children Fund within the next few days for a period of one month. That will airlift emergency food supplies to western Sudan where distribution problems have been acute. We are also providing up to £130,000 for the purchase of a light aircraft for use by voluntary agencies for moving supplies and personnel.
The European Development Council agreed on 23 May to my proposal to use emergency procedures to approve a £6 million project to rehabilitate the railway to western Sudan. I understand that the first phase, which provides special food trains, is already in operation.
We are holding further urgent discussions with the British voluntary agencies operating in Sudan to establish what immediate help we can give.

Mr. Meadowcroft: I am grateful to the Minister for his response. Does he accept that the House, and people in general, I suspect, will feel that it sounds very much like placing sticking plaster over a gaping human need? Surely much more needs to be done to enable the transportation of food from the east to the affected Darfur region in the west. One aeroplane and a light aircraft available to the voluntary agencies are not nearly enough. Will the Minister assure the House that the resources available are not limited by the existing budget, as with Ethiopia, but will be made available according to need? Otherwise a disaster far greater than that which occurred in Ethiopia will take place in Sudan?

Mr. Raison: The proposals that I have just announced amount to much more than sticking plaster. The problem is not the overall supply of food—there is a great deal of food available—but distribution. I believe that our aircraft, which will carry high priority supplementary foods, will be of great value. In addition, as I made clear in my reply, we have also galvanised the European Community to get on with the crucial job of ensuring that the railway line to western Sudan is fully operational. As I told the House, that process is already under way.

Mr. Bowen Wells: Is the railway capable of carrying enough food to western Darfur where the starvation is occurring? How much has the railway delivered to the western parts? Now that the rains are imminent, is it possible to distribute food in lorries from the railhead to the villages where it is needed?

Mr. Raison: I cannot yet say that I am satisfied that the railway is in a condition to provide all the food that is needed; it is a big job. However, I am confident that the steps that we have taken represent a substantial improvement. There is still more to be done on distribution

from the railhead. It is a difficult problem, but we are determined to do all that we can to make sure that food reaches the people who are so desperately in need.

Mr. Tom Clarke: Is the aircraft additional to the resources of the Overseas Development Administration, or is it coming from Ethiopia? Is the Minister bearing in mind the views of the Select Committee on Foreign Affairs, and will the additional resources be coming from the ODA budget or from the Government's contingency budget?

Mr. Raison: We shall be paying for the cost of the Hercules out of our own contingency resources. I stress that we do not intend to deprive our aid project in Ethiopia of anything to mount the aircraft operation in Sudan. It will be a new operation.

Mr. Mark Robinson: I am sure that all hon. Members will welcome the additional assistance that my right hon. Friend has been able to give to Sudan in recent months. Has my right hon. Friend any up-to-date information on the situation in the region mentioned in The Times?

Mr. Raison: We get regular reports of what is happening. I am not sure whether my hon. Friend is referring to the western part of Sudan or to the whole area. We get updated reports, and they show clearly that there is, overall, a substantial quantity of food, but serious limitations in the internal distribution of food. We are concentrating on that.

Mr. Tam Dalyell (Linlithgow): How about the provision of British-made trucks?

Mr. Raison: I know that the hon. Gentleman is keen on this matter, but large numbers of trucks are already available in Sudan, which has a strong private enterprise trucking industry. It is crucial that necessary spares are made available and, in the west of the country, the railway is the lifeline.

Mr. Robert Banks (Harrogate): I welcome my right hon. Friend's reply and recognise the grave seriousness of the situation in the Sudan, but does he agree that one of the problems of distribution stems from a shortage of fuel? Will he consider providing fuel so that distribution can be made rapidly?

Mr. Raison: The provision of fuel has been a constant worry, although I do not think that it has ever broken down in the way that was feared. We have contributed $272,000 for fuel for the distribution of our most recent consignment of food aid which arrived successfully in May before the rainy season began.

Mr. Stuart Holland (Vauxhall): The Minister must realise that this response is quite inadequate. It is far too little and far too late. Warnings were given by us in the House earlier this year that the fuel problem was critical and that Sudan needed at least 250,000 tonnes of fuel. We urged the Minister then to act directly rather than through the EEC and we called on the Government to release more vehicles, if necessary from Ministry of Defence stock. The Minister has not done that.
The right hon. Gentleman's comments about the resources now being given for renewal of the railway stock also are quite inadequate. Tenders were being offered by British firms in January, in the expectation that the renewal of the rolling stock would be done by June, so


that, when the rains came, the food aid could go through. As far as we can see, the project has only just been approved and the railway is inadequate to meet the food distribution needs, because only about one fifth of what is needed is getting through.

Mr. Raison: I have a feeling that whatever I announced from the Dispatch Box, the hon. Gentleman's automatic reaction would be that it was too little and too late. The railway, rather than fuel, is the crucial matter. The British Government have made the running throughout. We provided the consultant who prepared the plans earlier this year. I have repeatedly pushed as hard as I can in the European Community to get the project accelerated, because the understanding was always that the Community would implement it. I saw the Commissioner and told him the position a few weeks ago, and, at the Development Council on 23 May, I got it established that emergency procedures would be used. They are being used and the situation is improving, but I accept that there is still more to be done.

Mr. Holland: Six months too late.

Rolls-Royce, Derby

Mr. Speaker: I undertook yesterday to investigate a case of what appeared to be the premature disclosure by the Department of Trade and Industry of the text of a written reply to a parliamentary question put down for answer yesterday by the hon. Member for Southampton, Itchen (Mr. Chope). The matter was brought to my attention by the hon. Member for Derby, South (Mrs. Beckett).
I understand that a press release setting out the terms of the reply was intended to be issued by the Department for release at 4.30 pm but was, through an error, sent out at noon.
That constituted a breach of the rule under which answers to written questions may not be issued before 3.30 pm or before mid-day on Fridays. I hope that this rule will be maintained in the future.

Mrs. Margaret Beckett: While thanking you, Mr. Speaker, for that statement, I suggest that the House is owed at least a small apology by the Minister about the manner and timing of an announcement which had financial implications for the markets and strong implications for employment.

The Secretary of State for Trade and Industry (Mr. Norman Tebbit): I am grateful to you, Mr. Speaker, for making that statement. You are right to say that the press notice was issued in error, being wrongly sent among a number of other notices to the Central Office of Information at the time required for a noon distribution rather than at the time required for a 4.30 distribution, for which it was intended.
I should emphasise that the press notice did not carry an embargo. Therefore, no question of a breach of an embargo arises, so that on this occasion the press was innocent of any improper behaviour. I can only apologise to the House and to hon. Members who feel that they were inconvenienced for the breach of the rule which you have reiterated, Mr. Speaker.

Airports Policy

The Secretary of State for Transport (Mr. Nicholas Ridley): With permission, Mr. Speaker, I should like to make a statement about the Government's policy for airports.
It is the responsibility of Government to ensure that sufficient capacity can be provided at United Kingdom airports, where it is required and in due time. Our policy of encouraging competition in the air requires that there should be enough capacity available, so far as is possible, to all airlines on equal terms.
We cannot direct flights to airports that they do not wish to use. Airports must use the opportunities open to them to attract as many flights as they can through providing a cheap and efficient service for the benefit of the passengers.
To make airport managements more responsive to their customers' and further to assist the growth of our most important and successful airline industry, the Government have decided to introduce legislation, first, to make every major airport into a limited company, and, secondly, to convert the British Airports Authority into a holding company and to privatise it with its seven airport companies.
I hope that local authorities will follow this lead and introduce private capital into their companies, too; but we do not intend to force them to do so. A system of regulation will be proposed to control the monopoly aspects of airports, including charges, to regulate traffic distribution when necessary, and to safeguard essential national interests.
Our air transport industry is the envy of the world and a great success story. It has a turnover of £4 billion and earns £500 million of foreign exchange each year. It is a growing industry, already employing 85,000 people.
It is essential to the continuation of this success, and to the provision of more jobs, that there is sufficient airport capacity. Equally important, this must be done with minimum damage to the environment and to the lives of people living near airports.
It is with solving this dilemma—adequate capacity with minimum environmental damage — that first the Inspector at the airports inquiries, and more latterly the Government, have had to grapple. I should like to pay tribute again to Mr. Graham Eyre, QC, for his thorough and comprehensive report. In announcing our decisions today, I want to stress that we have sought a solution which meets both objectives as far as is humanly possible.
The success of our regional airports depends on them handling more traffic, which in turn depends on a growth in demand and on more airlines deciding to operate services from them. The signs are good. Traffic grew by 12 per cent, last year and is expected to increase by one third more by 1990. 1985 has seen the introduction at regional airports of many new scheduled services to international destinations, and more are planned. The Government will do everything they can to increase flights to and from the regional airports, first and foremost by British airlines. As regards foreign airlines, we recently reached an agreement with the Government of Singapore which allows Singapore Airlines to operate to Manchester. We expect shortly to begin discussions with the United

States Government about the basis on which scheduled traffic rights to Manchester for United States airlines may also be granted.
We will continue to study, with representatives of the regional airports, how to increase traffic still further. We will be ready to approve worthwhile investment in new facilities and the improvement of road and rail links where they are justified. We will ensure that competition between all airports, both BAA and local authority, will be on fair and equal terms. We recognise the importance of maintaining access for domestic flights into Heathrow and Gatwick.
Even after taking account of all these efforts to attract traffic to the regions and away from the south-east, the Government, after careful evaluation, have concluded that it is necessary to provide capacity in the south-east for between 72 million and 79 million passengers per annum by 1995. This is consistent with the inspector's planning figure of 75 million passengers per annum. We intend to achieve that figure as follows:
First, my right hon. Friend the Secretary of State for the Environment recently announced approval of the Stolport in London's docklands. This will provide 1 million passengers per annum.
Secondly, the Government have decided to invite Luton borough council to come forward with proposals, which would be subject to the necessary planning procedures to increase the capacity of Luton airport from its present throughput of 2 million passengers per annum to 5 million passengers per annum.
Thirdly, Gatwick airport is expected by that time to be capable on present plans of handling 21 million to 23 million passengers per annum. We have no plans for a second runway at Gatwick.
Fourthly, the capacity at Heathrow in 1995, when all four terminals will be in full operation, is expected to be between 38 million and 42 million passengers per annum. It is very possible that this will be adequate to handle as big a throughput of passengers as runway capacity will allow. The Government have decided to accept the inspector's recommendation that air transport movements at Heathrow should not be artificially constrained and to ask the House to accept the abandonment of the proposed limit of 275,000 air transport movements a year. Even with this, and with all foreseeable technological improvements to the full use of runways it seems likely that runway capacity, not terminal capacity, will be the limiting factor at Heathrow for some years ahead. Nevertheless, it seems prudent to ask the BAA to pursue with the Thames Water Authority the possibility of moving the Perry Oaks sludge works elsewhere. Only if and when this has been done, and in the light of traffic forecasts at that time, would it seem sensible to see whether extra terminal capacity should be provided, and if so how much. My right hon. Friend the Secretary of State for the Environment, on whose behalf the Minister for Housing and Construction has acted throughout, has turned down Uttlesford district council's application for planning permission for terminal 5, and no terminal can be built at Perry Oaks in the future without planning permission. We are setting up a study of improved surface access to Heathrow.
Fifthly, I come to Stansted. It will now be abundantly clear that the only way we can provide sufficient capacity to sustain the growth of our successful aviation industry is by terminal development at Stansted, thus bringing into
 

more effective use the spare runway capacity which is available there. My right hon. Friend the Secretary of State for the Environment and I have therefore decided to accept the inspector's recommendation to the extent of granting the BAA outline planning permission for development at Stansted. The application was for 15 mppa. The inspector recommended initial permission for this 15 mppa rising later to 25 mppa at Stansted. Although we have granted permission for the 15 mppa recommended by the inspector, we have decided to impose conditions requiring that the development be phased, and limited in the first phase of development to 7 to 8 mppa. The initial development will thus amount to less than one third of what the inspector recommended ultimately. Apart from the planning decision I propose to seek powers to limit air transport movements at airports. Subject to Parliament giving me the necessary powers, I intend to impose an initial limit on air transport movements at Stansted equivalent to 7 to 8 mppa. Any further increases in traffic at Stansted would be subject to control by Parliament, by means of an affirmative resolution. As a result, further growth of traffic at Stansted would only take place when it was seen to be necessary, with Parliament having the decisive role. This should provide reassurance to people living in the area. We have rejected the possibility of the construction of a second runway at Stansted.
In the past, we as a nation have shirked the decisions needed for the growth of air traffic and the jobs that go with it. We are in danger of stifling one of our most enterprising industries and losing out to our continental rivals: Schiphol, Paris and Frankfurt are building capacity well ahead of growth. They no doubt hope that we will shirk the decisions once again. The Government are determined not to.
The decision letters on the planning application and the White Paper, all of which are now available in the Vote Office, set out the arguments for these decisions at length and with clarity. When they have read them, I hope that right hon. and hon. Members will feel that our responsibilities to all the many important and often divergent interests concerned have been adequately discharged.

Mrs. Gwyneth Dunwoody: The Secretary of State has made a major statement on future airports policy. The one thing that is certain is that it gives the green light and go-ahead in the south-east of the country. It represents a list of broken promises. For example, a solemn promise was given to those living around Heathrow airport that the controls on aircraft movements would be respected, but that has been abandoned. Undertakings were also given to Manchester that it would be given assistance in developing as a regional airport. It was also suggested that, by somehow privatising the aircraft industry, we could support regional airports in, for example, Scotland.
Why should we believe the Secretary of State when he says, on the one hand, that he intends to privatise extensively to improve the future of the aircraft industry and, on the other, that he intends to ask the House for greater controls both on air traffic movements and on future developments? Why should we believe, for example, that he will move the Perry Oaks sludge works but has no intention of building a fifth terminal? Why should we believe that the right hon. Gentleman is now going to assist the regional airports when, in effect, he has

materially reversed his position since January 1985? In January, he said that he would give every possible support, particularly to regional airports. But the White Paper now makes it quite clear that in future any developments can go ahead only if the market has proven itself and the development is already there. That restriction is quite unacceptable.
What the right hon. Gentleman has done is to say that in future there will be added capacity at Stansted and Luton and increasing use of Heathrow. He is wholly uninterested both in the environmental aspects of the development of the major airports in the south-east and the very real industrial problems of the north. The statement is a slap in the face for regional airports and it should not be accepted by the House.

Mr. Ridley: I quite expected the hon. Lady to respond with predictable, old-fashioned reaction to the suggestion that the airport should be privatised, so I shall leave that typical reaction to one side.
On Manchester and the regional airports in the north:
The Government rejects the suggestion that the air transport industry should be subject to the damaging restrictions on its operations which would be the outcome of the forced diversion of traffic to regional airports".
If the hon. Lady does not agree with that statement, she might like to know that I was quoting her Government's White Paper of 1978. What was good enough for that Government is good enough for me. [HON. MEMBERS: "Oh."] With the exception of that, there is nothing that the north-west and the other regions have requested in the development of their airports that is not contained in the White Paper. When the hon. Lady has time to read it, she will find that that is so. No restrictions are being imposed on any development.
The hon. Lady appeared to be a little muddled. She accused me of abandoning the limit on air transport movements at Heathrow — about which the House expressed some disquiet earlier in the Session — and suggested that it should be proceeded with. At the same time, she appeared to want to have terminal 5 built, which would have meant more traffic going through Heathrow.

Mrs. Dunwoody: No, I did not say that.

Mr. Ridley: The hon. Lady's position, as she set it out, was that she had no desire to see terminal 5 at Heathrow, so she cannot complain both ways.

Mr. Toby Jessel: Is my right hon. Friend aware that very many of the 1·75 million people living around Heathrow, who were dreading the intolerable traffic congestion and noise that would have resulted from a fifth terminal, will be immensely grateful and relieved at the decision not to build a fifth terminal and to turn down the current planning application? I speak also for my right hon. Friend the Member for Spelthorne (Sir H. Atkins), who is currently abroad on Select Committee duty.

Mr. Ridley: I am grateful to my hon. Friend, especially for mentioning our right hon. Friend the Member for Spelthorne (Sir H. Atkins), who has already told me how sorry he is that he cannot be here, because he would have wished to be present on this occasion. [ am pleased to be able to honour, for both my hon. Friends, the Government's pledge that terminal 5 would not be constructed.

Mr.MichaelFoot: Does the right hon. Gentleman recall that, after our last debate on airports policy there was an overwhelming vote against the development of Stansted? Why has he resolved to flout that vote? Why should anyone believe that the House of Commons will have any control over these matters if he is deriding and insulting the last vote of the House on this issue?

Mr. Ridley: The right hon. Gentleman may recognise two points: first, the vote was on whether the House should adjourn—[HON. MEMBERS: "Oh."] Secondly, the inspector at the airport inquiry recommended development at Stansted first to 15 million and then to 25 million passengers a year, whereas the Government are recommending that development should be limited to 7 million to 8 million passengers a year.

Mr. Julian Amery: May I congratulate my right hon. Friend on having arrived at the same conclusion about Stansted as that at which I arrived 21 years ago? That was accepted by the Government of the day, despite the reservations of Mr. Rab Butler about the possible effect on his shooting.
I urge my right hon. Friend to go rather further than he has in recognising the enormous importance of the maximum development of Heathrow. It is not just the gateway to Britain; it is the Clapham Junction of air traffic between the American continent, the European continent and the far east. It is important that it should be endowed with all possible facilities to give it its maximum establishment. With the much less noisy aircraft and the shorter take-off now available, the environmental damage will be greatly reduced from what it would have been some years ago.

Mr. Ridley: I am grateful to my right hon. Friend. Perhaps it is auspicious that, 21 years after he considered the matter, the decision should come of age. I agree entirely about Heathrow. The Government's policy as set out in the White Paper will be to use the runways to the maximum capacity, and that is the limiting factor at Heathrow. That will be in the best interests of British aviation and Heathrow which, as my right hon. Friend said, is one of the most important airports in the world, and probably the most important interlining airport in the world.

Mr. James Molyneaux: The statement on United Kingdom airports makes clear its intentions to make the major airports into limited companies. Will such legislation apply to the Northern Ireland Airports Authority? In the light of the intention to develop regional airports, will the Secretary of State be evaluating the expansion of capacity and use• at Aldergrove international airport?

Mr. Ridley: These matters are for my right hon. Friend the Secretary of State for Northern Ireland, but the offer to assist regional airports in attracting overseas flights will extend to Belfast.

Mr. Alan Haselhurst: Is this not a case of putting the most capacity in the wrong place to meet the prescription that my right hon. Friend has given — that it will be difficult for London to maintain its competitive position if people are invited to interline by taking a bus around the M25? On the procedural point, why is my right hon. Friend prepared to trust the voice of

Parliament to defend Stansted growing beyond the 8 million passengers capacity when he is not prepared to give an opportunity for the House to judge the present position, which it could have done had he followed the precedent of the right hon. Member for Bethnal Green and Stepney (Mr. Shore) in the case of the Windscale inquiry?

Mr. Ridley: Airports will develop the traffic and the type of trade that suits them best under the freer regime that we are providing. I suspect that, more and more, Heathrow will develop into an interlining airport with a major input of domestic services, so the situation that my hon. Friend has suggested may not arise.
Secondly, my hon. Friend spoke about a special development order and I remember how the House, and he, welcomed the decision in 1980 that the Stansted proposal should be pursued through the normal planning process and should not be decided without a full and fair inquiry at which everybody could put their view. We adopted that proposal, and we cannot now be blamed for not changing our horses in midstream to the SDO proposal. The SDO method would have meant that we would be unable to secure the compulsory purchase orders, the listed building consents, the scheduled monuments consents, the trunk road orders, the side road orders and the stopping up and diversion of highways orders that will be necessary in the permission granted at Stansted.

Mr. Alfred Morris: Is the Secretary of State aware that his acceptance in principle and ultimately in practice of the development of Stansted airport into one of 15 million passengers per annum will cause the gravest concern in the north of England?
Julian Haviland, who is rightly respected on both sides of the House, reported this morning inThe Times the Minister's derisory comments about forcing Londoners onto Manchester-bound trains to fly to Paris. Is the Secretary of State aware that that is offensive not only to Mancunians, Geordies and people from Yorkshire and Scotland, but to people from all over the north? Is he aware that as many as 30 per cent, of the people who fly into and out of London airport are not from the south-east and do not want to fly there? Why should millions of northerners have to catch London-bound trains to fly abroad?
What does the statement do about licensing policy as it affects regional airports? What will the Secretary of State do urgently to stop the cross-subsidy of Stansted airport by the British Airports Authority? The right hon. Gentleman has missed an opportunity to unite this nation at a time when it is bitterly divided.

Mr. Ridley: I must differ from the right hon. Gentleman on his three main points, because he is not right. The development at Stansted is limited to 7 million to 8 million passengers per annum, and if the House does not want to go beyond that traffic figure, it lies within the power of the House to prevent it. Secondly, the right hon. Gentleman said that 30 per cent, of the passengers going through London airports are not from the south-east. However, the true figure is that 25 per cent, of the passengers going through London airports are not from the south-east, and of that 25 per cent., 5 per cent, comes from the north-west and the north-east, with the rest from other parts of the United Kingdom. More people come from the


south-west than from the north-west in passing through London's airports. The right hon. Gentleman's figures are not entirely right.
We have met the right hon. Gentleman's point that cross-subsidy to Stansted or any other airport will be stopped by making them separate limited companies. Any flow of funds will be transparent, and it will be made clear that those flows of funds must carry commercial interest rates. Therefore there will be no cross-subsidy.

Mr. Fred Silvester: I congratulate my right hon. Friend on continuing to be the Minister who has done most for regional airports of any since the war. However, will he remember that the two crucial matters for the north about the expansion of Stansted are that there should be no subsidy in that area, so that competition is free, and that the supporting infrastructure will be of a limited nature? Can my right hon. Friend confirm that that will be the case in both instances?

Mr. Ridley: I am grateful to my hon. Friend and I can confirm that there will be no subsidy to Stansted. The only investment will be of commercially raised money paying commercial rates of interest. That will cause landing charges to rise at Stansted to levels commensurate with other airports.
Secondly, the figures that I can give my hon. Friend for the infrastructure needed at Stansted development are £2 million for local roads. As well as that, there may or may not be some investment on rail infrastructure which could be about £50 million. That will be only if the investment appraisal of any scheme considered and put forward by British Rail achieves a positive result.

Mr. John Cartwright: Does the right hon. Gentleman accept that his fine words about regional airports fall a long way short of the real commitment that is needed if they are able to compete fairly? How realistic are the limitations on development that the right hon. Gentleman is proposing for Stansted? Surely it will be attractive to airline operators only if it has the fast rail link that the inspector recommended. British Rail tells us that it cannot justify financial investment without far more passengers at Stansted than the Secretary of State is suggesting. Is he not opening the door to the full-blooded development of Stansted?

Mr. Ridley: As an earnest of our intentions to improve and expand flights from regional airports, I point out that there are now 33 international scheduled services from Manchester airport, 14 of which have been inaugurated this year alone. That is a measure of what the Government are doing to increase traffic at regional airports. As I said in the statement, we shall continue to explore ways of getting more flights into the regional airports.
Secondly, on British Rail, nobody has known until now about the development of 7 million to 8 million passengers per annum at Stansted that I have announced today. Until British Rail has had a chance to assess the possibilities, it will be impossible to know how much it will cost and whether it will be economic at all. Far from opening the floodgates to Stansted, the result of my announcement may be that it is not economic to provide a rail link, and that would be a brake upon the development of Stansted.

Mr. Graham Bright: I congratulate my right hon. Friend on guaranteeing the future of Luton

airport and, indeed, offering the prospect of a considerable number of new jobs in the area. Will he confirm that 5 million passengers a year is a final figure and that it will not be allowed to increase? Will encouragement be given to scheduled air services to use that airport, rather than developing the charter traffic that we have had to date?

Mr. Ridley: I am grateful to my hon. Friend. Luton borough council will be invited to submit proposals, which might be subject to a planning inquiry. I gather that the limit on what can be accommodated at Luton is controlled by national air traffic considerations and is unlikely to exceed 5 million passengers. It will be for the borough council to make such proposals as it sees fit.
My hon. Friend also asked about scheduled flights from Luton. I believe that some are taking place already but there will be no inhibition on scheduled flights to any airport to which an airline applies for a route licence to operate.

Mr. Terry Dicks(Hayes and Harlington): Will my right hon. Friend accept that many of my constituents will be bitterly disappointed at the decision not to go ahead immediately with a fifth terminal at Heathrow? They will believe that he does not understand the needs of Heathrow and that, because he has not listened to them, he does not understand the operating needs of the airlines that are using Heathrow.

Mr. Ridley: There is no possibility of putting a fifth terminal in the middle of the Perry Oaks sludge works. I am sure that even my hon. Friend would agree that the sludge works would have to be moved first. Surely it would make sense to decide on the scope and size of the terminal which might be put there when we discover whether any terminal is necessary after the sludge works has been moved.

Mr. George Foulkes: Why does the Secretary of State not admit the truth—that the huge increase in capacity in the southeast of England will make every Scottish airport less viable and will make it less likely that there will be direct flights from Scottish airports to destinations overseas? Since he has recently announced the continuation of Prestwick as Scotland's transatlantic gateway, what assurances has he received from the British Airports Authority and what guarantees will there be that Prestwick will continue to be Scotland's transatlantic gateway and, indeed, will remain open? Is he aware that we find it very sinister that separate companies are to be set up and that the British Airports Authority will not be privatised as one company?

Mr. Ridley: In the last year there has been a 20 per cent, increase in flights from Edinburgh to London. If that rate of growth continues, I shall have to find still more capacity in the south-east to accommodate the flights that the hon. Gentleman wants to travel on. How he can want both more aviation out of Scotland and less landing space in England beats me. The airport at Prestwick was the subject of a recent announcement in response to a question, and I have nothing to add to what was said at that time.

Sir Peter Blaker: Is my right hon. Friend aware that the removal of artificial constraints on the number of landings at Heathrow will be helpful to many provincial airports? He is to be congratulated on stopping the subsidy to Stansted. Is it not bizarre that for


years charges for aircraft at that airport have been subsidised by large sums out of the profits of the so-called duty-free shops at Heathrow, to the disadvantage of provincial airports? Will not the change be very important for airports such as Manchester?

Mr. Ridley: I agree entirely with the two points that my right hon. Friend has made. First, it is important to keep as much access to London, and particularly Heathrow, as we can for domestic flights from the rest of the country. Secondly, I confirm that Stansted has benefited financially from the profits of other BAA airports. This should not be the case in future under our proposals.

Mr.BruceMillan(Glasgow,Govan): Is the Secretary of State aware that he missed the point about flights from Scotland to London? We do not want more flights to London; we want more flights from Scotland to destinations abroad without having to come through London. In the case of Prestwick, how does the Secretary of State expect a private limited company to operate Prestwick, given the bias towards the south-east in his statement today? Does his statement not make a farce of the review that was promised for Prestwick? Indeed, have we not heard from him today the pronouncement of a deferred death sentence on Prestwick?

Mr. Ridley: I said earlier that we would do all we could to increase flights from any regional airport. That does not exclude Scottish airports. They are in that category from the point of view of what I was saying. We shall do what we can to license flights out of airports in the rest of the United Kingdom.
Let me make it clear that my statement will not have the effect that the right hon. Gentleman suggested in regard to a public limited company at Prestwick. All that can happen is that it will show a loss in its accounts at the end of the year, and it does that anyway.

Mr. Bill Walker: My right hon. Friend is to be congratulated because, for the first time for many years, we have a Minister who has grasped the nettle. Contrary to some of the comments that have been made about Scottish airports, I am confident that they will continue to prosper, as they were doing for a long time before the OPEC oil price increases; they are now recovering. Will my right hon. Friend confirm that the Scottish airports will be managed largely by Scots?

Mr. Ridley: I am grateful to my hon. Friend. I can confirm that the British Airports Authority, while still in public ownership, will be invited to continue to have a Scottish vice-chairman and to have a large degree of Scottish management. Of course, if it passes into the private sector those matters will be beyond Government control, but I am certain that it will be in the interests of the new company to make sure that the four Scottish companies are managed predominantly by Scots.

Mr. Eddie Loyden: Is the Secretary of State aware that his statement today will be greeted with disappointment and perhaps anger by the northern regions, which will see it as another example of the Government's disregard of their problems? What

effect will the statement have on Liverpool airport in my constituency? Will he give an assurance that the sludge works will not be shifted to Liverpool?

Mr. Ridley: I must repudiate both those suggestions. I do not remember a more helpful and determined attempt to assist the north. It is not more runway capacity, terminal capacity or airport capacity that is needed in the north of England, but more flights. The more flights we can get into the north, the more that will help the northern airports to expand and in due course to need more capacity. That is what we seek. I can give the hon. Gentleman an absolutely categorical assurance that the sludge works will not be moved to Liverpool.

Sir Fergus Montgomery: Is my right hon. Friend aware that his statement will go a long way to meeting the requirements of Manchester airport?

Mrs. Dunwoody: No.

Sir Fergus Montgomery: I suggest that the hon. Lady reads the White Paper. Can my right hon. Friend give a firm commitment to the constructive development of an international hub at Manchester? Can he give an assurance that, if British carriers are unwilling or not prepared to apply for flights on viable international routes out of Manchester, the applications of foreign carriers will be approved speedily and will not be subject to the two-year delay that Singapore Airlines had to endure?

Mr. Ridley: I am grateful to my hon. Friend. I am sure that if hon. Members read the White Paper they will discover more than I have been able to explain in my short statement.
I confirm that we intend to try to help Manchester airport build itself up into a hub for the north of England. That is what I said when I offered help to try to bring more traffic to that airport. The Singapore Government applied in March for a flight to Manchester and agreement was reached within six weeks. That is almost a record time for coming to an agreement on such a major application.
I am sure that my hon. Friend will agree that, although we want to do everything that we can to maximise traffic into and out of Manchester and the other regional airports, we want to give our airlines a good opportunity in the countries with which we are dealing. The greatest contribution to jobs that a regional airport can make is by British airlines obtaining traffic rights to fly out of the regional airports to overseas capitals. It is not just a question of welcoming foreigners into our regional airports, but of making deals which will benefit Manchester, for instance, and create jobs in the north.

Mr. Tony Lloyd: Is the Secretary of State aware that he is to be congratulated on one matter alone? He seems to have done enough to buy off his own Back Benchers from the north of England, but it is a policy for one region—the south-east—not a policy for the north.
When did Manchester ever ask for further runways or terminals? Manchester has always made one simple request — to be given the flights. It has always been denied that and the Minister has denied it again today. Manchester is not a regional airport. It wants to be a national gateway airport, as promised.

Mr. Ridley: Manchester is a gateway airport and will remain so. If the hon. Gentleman reads the White Paper he will discover that there are already route licences for 1,500 overseas routes out of the regional airports, of which


only 100 have so far been taken up. The problem is to persuade airlines to take up more overseas routes from regional airports. That is the real problem from which all regional airports suffer and that is why the Government have addressed themselves with enormous diligence to trying to help put it right.

Dr. Alan Glyn: May I congratulate my right hon. Friend on honouring his promise not to construct the fifth terminal? Is he aware that that will bring great relief—[Interruption]. It certainly will not be constructed in this Parliament or the foreseeable future.
Is my right hon. Friend aware that my constituents suffer more than others from the noise problems, but are not entitled to proper funds to pay for insulation grants? Is he further aware that I am disappointed that the pledges about the number of flights given on 22 February and 21 November 1984 are not to be honoured? We are told that access to Heathrow will be increased, but I do not see how it can be increased by road improvements into London and most people travel to Heathrow by road. Is my right hon. Friend aware that his decision about Perry Oaks will be heavily criticised generally, not only by the Berkshire county council?

Mr. Ridley: I understand my hon. Friend's point of view. He is right that the decision on terminal 5 will be of some comfort to his constituents. Aircraft are rapidly becoming quieter and will become even quieter as new types are phased in. That will make a great difference to the noise in his constituency.
The Government were in a difficulty when the inspector on terminal four suggested that an ATM limit should be imposed on Heathrow and the inspector at the inquiry on terminal five suggested that there should be no such limit. The Government had to make up their mind and put their decision to the House, which will in due course have to accept or reject that decision.
Underground and rail access to Heathrow will be studied as carefully as road access because we must try to improve traffic between London and Heathrow in any way we can. Matters relating to Perry Oaks are perilously close to being the responsibility of my hon. Friend the Minister for Housing and Construction.

Mr. Simon Hughes: What steps will the Secretary of State take to ensure that the environmental damage and difficulties from which people near all airports suffer will be dealt with in the proposed legislation? Can the right hon. Gentleman explain the apparent illogicality in saying that he intends to take powers to limit air traffic movements—to apply immediately at Stansted — and that he also intends to remove restrictions at Heathrow, and presumably elsewhere? Where is the logic in that, when he knows that restrictions on movements are wanted not for commercial reasons, but for environmental reasons?

Mr. Ridley: When the hon. Gentleman reads the White Paper he will see that further protection in terms of abatement measures and of insulation are proposed for those living near Stansted. We shall further develop our understanding of what helps most to ease the pressure on people from aircraft noise.
Perhaps the Liberals would neglect to worry about this, but I have to provide sufficient capacity for the air

transport industry to grow and to provide jobs. The decisions are based on there being adequate capacity for planes to land in the south-east of England. That is why, reluctantly, I have to recommend to the House that we should not put an artificial limit on the number of flights that can be accepted at Heathrow. My hon. Friends who represent areas around Stansted have made it clear that they want some protection from too great an expansion of Stansted.
The hon. Member for Southwark and Bermondsey (Mr. Hughes) asked me how I intended to protect the environment of those who live near Stansted and other airports. The answer is that I intend to impose an ATM limit, which he seems to be against.

Mr. Robert McCrindle: In an attempt to evaluate the environmental impact of the decision on Stansted, having been told the number of passengers per year anticipated, are we not also entitled to hear the Secretary of State's views on the type of traffic which he envisages? If he is prepared implicitly to apply a movements limit to the expanded Stansted, might he also be prepared to impose a night curfew on Stansted? If that is so, does it not imply that he should be looking for charter traffic rather than scheduled traffic?

Mr. Ridley: All these matters are dealt with at length in the White Paper. We did not think it right to accept the inspector's recommendation that there should be night bans at London airports, although the present restrictions will certainly remain and possibly be tightened to ensure that night flying does not increase. A ban would be going too far.

Mr. Kevin Barron: When the Minister was drawing up the plans for an airports policy did he see the need for the development of new regional airports?

Mr. Ridley: The hon. Gentleman will know that we had either to accept or reject the recommendations in the inspector's report. It would not have been appropriate to suggest a totally different site, but I confirm that the Government do not believe that any new site, not mentioned today, would be preferable to the sites that we have been studying and about which we have made decisions.

Mr. Bowen Wells: Does my right hon. Friend accept that many of my constituents will greet his announcement with great anger and disappointment? They have fought the development of Stansted over 25 years and through two different public inquiries, only to face the decision that he has made today. My constituents are prepared to play their part in the national interest and accept that some development has to take place. I am grateful to him for the limitation to which he has agreed of 7 million to 8 million passenger movements per annum, although I believe that that is far too high a limit. I am also grateful for the fact that he has prevented cross-subsidisation of Stansted airport.
However, will my right hon. Friend accept that his proposals will result in great detriment to the environment of the area and that the people of Sawbridgeworth will have to suffer all the inconveniences of air traffic noise and pollution and a crowding of the very inadequate roads all around that airport, which he has apparently made no provision to improve? Will my right hon. Friend tell me


—perhaps his hon. Friend the Minister for Housing and Construction will advise him on this — whether he intends to break the green belt policy that surrounds that airport to the north and to the south, and whether he will prevent the tremendous competition for jobs in an already over-employed area and the inevitable expansion of urbanisation which will occur unless strong measures are taken by his hon. Friend the Minister to prevent it?

Mr. Ridley: My hon. Friend the Minister for Housing and Construction will have heard what my hon. Friend said about the planning aspects of the decision and its future consequences. I have total understanding of the disappointment of some of his constituents and the fears about their peace and the environment of that very pleasant part of the country. But I am sure that he will equally accept that, as a result of that sympathy, we have gone a very long way to limit the development to that which is essential in the national interest for the aviation industry. I think that the House would blame me, with particular justice, if in a few years traffic had to be turned away and perhaps had to go to the Continent and the transport of the country was interfered with. I hae tried through the subsidy assurance and the ATM limit which he mentioned to make this development happen only if it is necessary and economic, and I think the fact that the House will have a further decision to take if ever further expansion were proposed should be of considerable reassurance to his constituents.

Mr. David Young: May I ask the Minister not to concentrate on the spin-off to Manchester from the south of the country? What does he intend to do to establish Manchester as a national airport and the economic and tourist gateway to the north-west? What does he intend to do to establish that airport not as a subsidiary airport but as a national airport in a region with one of the highest unemployment levels?

Mr. Ridley: The hon. Gentleman must acknowledge that the growth of Manchester has been phenomenal. There has been the large growth of up to 6 million passengers per annum hitherto, and we expect that to continue. Indeed, a 30 per cent, further growth to the end of the decade is predicted. That is about as rapid a growth as any airport has ever experienced. Secondly, it is no coincidence that it has taken place during the period of office of this Government. Therefore, I think that, if the hon. Gentleman is at all honest, he will go back to his constituents and tell them what a tremendous boost to Manchester this statement has been—as have been the policies of the Government in the past.

Mr. Anthony Steen: I believe that this is the best news for the British air transport industry since sliced bread, and I should like to congratulate the Secretary of State on his radical, reforming and decisive statement today. I should like to ask him about the environment—this is not the prerogative of the Liberal party, but a matter with which the Conservative party is greatly concerned—and the lifting of the 275,000 limit at Heathrow. Can he say something reassuring to those people who live on the boundaries of that limit? As he knows, aeroplanes are getting quieter, and I think that people should be reassured that the lifting of the limit will not make life intolerable for them.

Mr. Ridley: I am grateful to my hon. Friend. As I said in the statement, it is extremely difficult to balance the needs of the industry—I think that we all accept that industry has to be allowed to grow—with the difficult environmental questions about which I share his concern. There is a great deal about this in the White Paper, which I hope he will find helpful. The decline in noise levels has been and will continue to be dramatic as aircraft are required to be quieter, and as we have taken measures to protect the houses of the people who are most closely concerned, so let him not doubt that the Government are keen to do everything that we can to protect the environment of those who live around Heathrow. But let it be said that many people who live around Heathrow do so for the sake of the jobs that they have in the area, and are prepared to accept the noise and the difficulty for the sake of the prosperity that the airport brings.

Mr. Andrew F. Bennett: Will the Minister accept that most people in Greater Manchester will be disgusted by the statement and will bitterly resent the Government's claim that they have anything to do with the success of Manchester international airport? In fact, it is an example of a municipal airport which has succeeded in spite of the Government's hostility to municipal airports. If the Government want to win any friends in the Greater Manchester area, they should consider quickly providing the one to one and a half miles of railway that is necessary to link Manchester international airport to the national rail network and ensure that nearly one quarter of the population of the country are within an hour's journey time of Manchester airport.

Mr. Ridley: That staggering increase in flights, particularly international flights, which has taken place out of Manchester airport has occurred during the currency of this Government. The fact that, of the 33 international points currently served by scheduled services out of Manchester airport, 14 have begun to be served in this year alone is evidence, if the hon. Gentleman needs evidence, that the Government are not in any way prejudiced against it, but if anything are prejudiced in its favour.

Mr. Bennett: What about the railway?

Mr. Ridley: If the hon. Gentleman had listened to the statement, he would have heard that the Government have invited British Rail to examine the possibility of the rail link and to submit proposals for the investment if the necessary tests are passed.

Sir Walter Clegg: Is my right hon. Friend aware that many Conservative Members representing northern constituencies disagree a great deal with what has been said by Opposition Members? In fact, the White Paper will be helpful to Manchester, especially as there will be no subsidy to put us at a disadvantage compared to Stansted?

Mr. Ridley: I am grateful to my hon. Friend for what he has said. I believe it to be true and I believe that the White Paper will give a new opportunity to the regional airports for further growth.

Mr. Peter Pike: Will the Secretary of State not accept that his statement will be seen as a kick in the teeth to people in all regions of the country, and particularly in the north-west by people who want to use Manchester airport? Will he not admit that in fact he knows that it will not be possible to maintain the ceiling


of 7 million to 8 million movements at Stansted? He knows that, when privatisation takes place, to make it viable it will be necessary to go beyond that limit. That means that the fast rail link and the supporting infrastructure will have to be established, and the rest of the country once again will be paying for London to get the benefits.

Mr. Ridley: I do not see how Manchester can be such a successful, prosperous and thriving airport with a throughput of 6 milion passengers per annum, if the hon. Gentleman suggests that Stansted, with 7 million to 8 million, will be totally uneconomic because of inadequate throughput. It just does not make sense.

Mr. Jerry Hayes: May I take this opportunity to congratulate my right hon. Friend on getting away with such a lot today—which I suspect is probably due to the total incompetence of the hon. Member for Crewe and Nantwich (Mrs. Dunwoody), who appeared to fail to grasp what he was talking about?
When the sighs of relief of my hon. Friends have subsided and they begin to read the small print, I am sure that they will realise that this is a package which will upset many and please few and will probably be precisely the sort of fudge about which the inspector warned.

Mr. Ridley: I do not think that it is ever necessary to blame the hon. Member for Crewe and Nantwich (Mrs. Dunwoody). She seldom seems to understand what we are talking about, and today is no exception.
It was not possible, given the situation that the Government faced, to make everyone feel that he had got exactly what he wanted. However, I believe that our decisions will both provide the necessary capacity and do the minimum damage to the environment of the various airports involved. If my hon. Friend reads the White Paper, I feel that he will find many statements in it to reassure him.

Mr. Robert C. Brown: Is the Secretary of State aware that the development of airports such as Newcastle reflects great credit on the local authorities which have had the foresight and will to develop first-class regional airports?
The right hon. Gentleman's statement is a second slap in the face for the north-east. Only last year he refused to allow the Newcastle authority to use its own money to build a parallel taxiway and so avoid delays in landings and take-offs. Now, when the airport is producing more than £1 million of profit for the ratepayers who have provided the capital for its development, he suggests that it should be privatised. Could it be that the right hon. Gentleman regards profits for the ratepayers of the area as grossly immoral, but profits going into private pockets as very good?

Mr. Ridley: The hon. Gentleman referred to Newcastle airport. He will know that the authority put in a bid for other priorities and then changed its mind about what it wanted. At any stage, if Newcastle airport wants to apply for investment approval for any project, we are always happy to look at it. However, the capacity at Newcastle airport is currently used only to the extent of 54 per cent. The airport needs not more bricks and mortar but more flights. That is why I have concentrated today on the importance of trying to get more flights into regional airports.

Mr. Robert Adley: Is my right hon. Friend aware that his juxtapositioning of the announcement of the privatisation of the British Airports Authority with the go-ahead for Stansted will inevitably lead some of us—I am one—to believe that, rather than today's announcement being made under the heading of airports policy, it might have been made by a Treasury Minister. To allay that fear, will my right hon. Friend at least assure the House that he will privatise the BAA before Stansted goes ahead?
Turning to airports policy—

Mr. Speaker: Briefly, though.

Mr. Adley: —will my right hon. Friend accept that trying to provide three London airports, none of which will be fully adequate, is a recipe for disaster? It will turn the M25, even without a channel tunnel, into a solid ring of parked vehicles on numerous days of the week. Will he assure the House much more than he has done so far that the investment in the rail infrastructure for Stansted and for Heathrow will be looked at overall not only in terms of the environment but as part of the environmental costs of airports policy?

Mr. Ridley: Some of us—I am one—will give my hon. Friend the assurance that he seeks that the rail infrastructure will be looked at in the way that I said, but with sympathy because of the environmental problems.
I cannot foretell how long it will be before it is possible to privatise the British Airports Authority. That will depend on the progress through the House of the necessary legislation. I fear that I must also say that planning consent has now been granted for the Stansted development, and I have no doubt that the authority will wish to start work as soon as the necessary plans are drawn up.

Several Hon. Members: rose—

Mr. Speaker: Order. I shall allow questions on this statement to go on for a further 10 minutes. That means that Back Benchers will have had a full hour in which to put their questions to the Secretary of State. However, I ask for brief questions, in which case I hope to be able to call all those hon. Members who are seeking to catch my eye.

Mr. Tam Dalyell: Will the Secretary of State say a little more about the study into improved surface access to London Heathrow? Does this mean trains that will not stop at all the Hounslows? Are we sure that the study is not a broody hen sitting on a china egg? What will it do?

Mr. Ridley: I am not sure to what the hon. Gentleman's last comment referred. There are three authorities concerned—London Regional Transport in respect of the underground, British Rail, and my own Department for roads. I shall bring them together and get them to study very quickly and carefully—

Mr. Dalyell: Study what?

Mr. Ridley: —how to provide extra capacity from the centre of London to Heathrow without causing damage to the environment again. That is exactly what we need to do.

Mr. Michael Forsyth: I welcome my right hon. Friend's decision to privatise the British Airports Authority. When does he expect to introduce the necessary


legislation? How will he ensure that the BAA does not exploit its monopoly and that we get fair competition between airports?

Mr. Ridley: I am grateful to my hon. Friend. The necessary legislation for privatisation will be introduced as soon as possible.
As for cross-subsidy and fair competition, putting each airport into a separate public limited company means that any transfer of funds will be transparent. As I said, we shall make sure that the transfer of funds takes place only at commercial rates of interest. That in itself will cut out cross-subsidy.

Mr. Ken Eastham: Does not today's statement about Stansted mean that once again millions of pounds are to be invested in the south of England? Is it not clear that in a few years this decision will be considered only as a toe in the door, and once again the Government will ask the House to vote millions of pounds, which again will be invested in the south? What consideration has the Minister given to industry and commerce in the north? The Government argue that there is a case for airport developments in the north not just for industry and commerce but also for tourism. How will the Stansted development help the traffic throughput in the northern airports?

Mr. Ridley: The approximate cost of the development of Stansted is thought to be about £270 million. I cannot give a firmer figure than that, because the British Airports Authority has not been able to give me a quotation, having only just heard of the decision.

Mr. Eastham: That is for now.

Mr. Ridley: I do not regard that as a large investment and, of course, it is all from air travellers' money—it is not from public money. The British Airports Authority earns a surplus, and it will be investing that at commercial rates of interest in the new development.
I am as keen as the hon. Member for Manchester, Blackley (Mr. Eastham) and as Manchester to see further traffic and activity in the north of England. That is why we have put our accent on trying to get more traffic going there. It is from that that the extra jobs will flow and not from building terminals, runways, aprons and taxiways which are not needed.

Sir John Biggs-Davison: In view of my right hon. Friend's concern for the environment around airports, how does he think that the beautiful rural character of the environment of Stansted will survive his proposals?

Mr. Ridley: An increase in the terminal buildings at Stansted will not improve the landscape, but there is an airport there already, and there are terminal buildings. It is conceivably possible that any new buildings will be slightly more pleasant to look at than the old ones. I hope that they are. We have to find a way of marrying careful and good design with our landscape; otherwise we shall become a museum and unable to earn our living.

Mr. D. N. Campbell Savours: Is the Secretary of State aware that the concern of Air Ecosse flying from Carlisle to Heathrow is landing charges? Will those charges rise or fall as a result of today's statement?

Mr. Ridley: The hon. Gentleman may not have heard it, but in my statement I said that the Civil Aviation Authority would be asked to supervise landing fees and charges at the various airports. I think that the result of that is more likely to bring down charges imposed by a monopoly than if we allow the monopoly to be free to charge what it likes.

Mr. Michael Colvin: Further to what my right hon. Friend said about privatisation, is he happy that individual airports which operate as independent plcs will be able to raise the capital required for their future expansion without any cross-subsidisation or Government guarantees? In relation to Heathrow, while uncertainty about terminal 5 persists, does he think that that company will be able to go to the market, especially as today he hinted clearly that, subject to planning, terminal 5 will be built one day?

Mr. Ridley: We shall put the seven BAA plc airports into a holding company, which will be able to make investments in any subsidiary that it wishes. The company which owns Heathrow will be one of the most prosperous companies in the country. The idea that it would not have credit to borrow to build a terminal, if one were necessary, seems unlikely.

Mr. Max Madden: Does not the Secretary of State realise that he is widely regarded as the Secretary of State for Transport who has dealt a grievous blow to our railway network, who wants to destroy public bus transport throughout the country, and who, with today's statement, has delivered a hammer blow to our regional airports? Does he further realise that millions of people who live in the north can see no justification for resources, whether public or private, being channelled into the south-east, that large numbers of unemployed people in the north can see no good reason for the creation of large numbers of jobs in relatively prosperous areas and, most important, that people who are inconvenienced by the existing travel arrangements can see no good reason for maximising flights from London airports?

Mr. Ridley: I find that a little odd. I think of myself as the Secretary of State for Transport who has presided over the highest rate of investment in British Rail for many years. I should like to claim that I am the Secretary of State for Transport who has freed the bus services from restrictions so that they can be improved and expanded, and who has now put forward a policy for the further expansion of the airline industry, which will bring jobs to all areas.

Mr. Christopher Murphy: Will my right hon. Friend consider my constituents, who are sandwiched between the development at Luton and that at Stansted? Does he recognise that they are extremely concerned on environmental grounds? Will he say what consolation I can offer them?

Mr. Ridley: My hon. Friend is in a slightly difficult position. There will have to be a public inquiry if Luton borough council makes proposals for expansion, and his constituents can put forward their views then. The developments at Stansted and Luton will result in a large number of extra jobs. My hon. Friend can draw some comfort from the fact that many people living in the area will benefit from those jobs, and that many, for that reason, are not wholly opposed to airport development.

Mr.MalcolmBruce: The Secretary of State will realise that hon. Members with BAA airports in our constituencies recognise the benefits that we have reaped from the managements, especially in Scotland. Is he aware of the anxiety caused by the fact that nowhere in his statement is there a suggestion that Scottish airports should be retained as a group? Indeed, he said that they would be sold off individually. Can he assure us about that? Regarding surface transport, does he recognise that the one way to help Prestwick airport to survive is to give the go-ahead to an effective rail link?

Mr. Ridley: The hon. Gentleman may have misheard me. I made it clear that the privatisation of BAA would be achieved by privatising the holding company, and that the separate companies would not be sold off independently. Therefore, the group will remain exactly the same as at present, and there will be little change in the relationship in that sense. The question of a rail link to Prestwick is one for British Rail, which can submit proposals, if it finds that a link is economic. That is also referred to in the White Paper.

Mr. Malcolm Thornton: Although I agree with my right hon. Friend that it is impossible to please everyone on these occasions, I thank him for the courtesy that he showed to the representations made by the North-West Regional Consortium, and the weight given to them in making his decision today. In so far as it is his responsibility, when he looks at the infrastructure requirements for the expansion of an airport which has seen spectacular growth — his statement said that of Manchester airport—will he ensure that investment will not be denied in favour of speculative growth at Stansted?

Mr. Ridley: I am grateful to my hon. Friend for what he said. I assure him that the question of investment in the rail link to Manchester airport will be taken on its merits, with regard to both an estimate of the build-up of traffic that will occur at Manchester and the environmental desirability of it. It will certainly not be affected or disadvantaged by anything at Stansted.

Mr. Gerald Howarth: I congratulate my right hon. Friend on having had the good grace to withdraw the artificial limits on Heathrow movements. Does he agree that that decision is inconsistent with the refusal to grant planning permission for terminal 5 now, which would present a great opportunity to redevelop Heathrow into the next century? Does he agree that Stansted would not be necessary if we had two runways at Gatwick, which the BAA has resisted and that it would be folly to build another international airport with one runway and repeat all these troubles in 30 yèars time?

Mr. Ridley: It is likely that some parts of the Civil Aviation Bill, to which my hon. Friend referred, will reappear in the later legislation. We regard air transport movement limitations both at Stansted and potentially at other airports as something which may eventually be necessary. That was the purpose of the original legislation. I doubt whether my hon. Friend would receive much support from people living in both Sussexes for his suggestion that there should be two runways at Gatwick. There is an agreement between BAA and the county council that that should not happen, and the Government

have no plans to interrupt it. It would mean the demolition of a village and major environmental difficulties, and we prefer not to cause that.

Mr. Stuart Randall: I was pleased that the Secretary of State hoped that landing charges for a small airline at Heathrow would fall. I have a particular interest in Humberside airport. In the event of landing charges not falling, what special action will the Secretary of State take to help small airlines to be competitive and to overcome the problems of high landing charges?

Mr. Ridley: At present, the charges that airports levy are entirely within their control. I have no control over them, either at BAA or local authority airports. I propose that, as part of the new regulatory regime for airports generally, the CAA will have power to supervise landing fees and charges. However, legislation will have to come into effect before that can happen. I am sure that the CAA will want to interpret such a new power by stopping the exploitation of a monopoly and ensuring that the charging structure does not discriminate against any type of aircraft or airline.

Sir Anthony Grant: Although I appreciate my right hon. Friend's attempt to phase the expansion at Stansted, is he aware that an expansion to 15 million passenger movements a year would be wholly unacceptable to the people of Cambridgeshire? In view of his faith in the parliamentary process, may we assume he will encourage his colleagues to allow a free vote if that matter comes before the House? Before any such expansion takes place, why does he not do what the world's airlines want and instead of talking about sludge pits make a firm commitment to a fifth terminal at Heathrow?

Mr. Ridley: I doubt whether a proposal to increase the air transport movement limit at Stansted will come before the House for many years, because we have not yet imposed it, which is the first step. I cannot anticipate the decisions of my right hon. Friends the Leader of the House and the Patronage Secretary about the nature of the whipping on an occasion many years ahead and, perhaps, in a different Parliament, under powers which Parliament has not yet granted—[AN HON. MEMBER: "And a different Minister."] Yes, I accept that amendment.
As to a fifth terminal at Heathrow, we believe that retaining a large amount of room at Heathrow for domestic flights, as many hon. Members have stressed, is important. The result is that the number of passengers is not as great as was expected when Mr. Eyre reported. If it is not terminal capacity, but runway capacity, that limits the use of Heathrow, it would be wrong to embark on building an enormously expensive terminal before there is a clear need for it.

Mr. Cecil Franks: Does my right hon. Friend accept that many will interpret his statement not as one on a national airports policy but as one on an airport policy for the south-east? Many people will be appalled at the perfunctory reference in his statement to regional airports, especially airports in the north. Does he also accept that many people will infer from his statement unfair competition and subsidy by taxpayers for the development of Stansted? Will he explain why a Government who are committed to the


operation of market forces cannot allow those market forces to determine the natural growth of Stansted, Manchester or any other airport?

Mr. Ridley: I have not made a precise measurement, but I believe that about one third of my statement dealt with helping regional airports. I would hardly call that a perfunctory reference in what was a long statement. I have given every assurance this afternoon that there will be no opportunity for cross-subsidy to Stansted to the detriment of other competing airports. Market forces will prevail to the extent that it will be for the proprietors of airports, whether Stansted, Manchester or any other to decide whether investments are made at commercial rates of interests.

Several Hon. Members: rose—

Mr. Speaker: As an act of chivalry — Mrs. Bottomley.

Mrs. Virginia Bottomley: Thank you, Mr. Speaker.
Does my right hon. Friend agree that the only alternative to the loss of profitable air transport business to continental Europe is to have some expansion in the south-east? Although I understand why those in the affected areas, whether in the south-east or in the regions, are worried, we would all have much more reason to be worried if the Government's decisions resulted in the loss of British jobs and earnings.

Mr. Ridley: I agree with my hon. Friend. The first London airport is Heathrow with 29 million passengers. The second London airport is Gatwick with 14 million passengers. The third London airport is Charles de Gaulle with 13·6 million passengers. The fourth London airport is Schiphol with 10·9 million passengers. The fifth London airport is Manchester with 6 million passengers. Stansted does not even appear on the list.

Several Hon. Members: rose—

Mr. Speaker: Order I am sorry that I have been unable to call all those hon. Members who wish to take part.

Mr. Anthony Nelson: On a point of order, Mr. Speaker.

Mr. Speaker: No. All that I can say is that I shall give them preference when we have a debate on the subject. It is no good raising a point of order on this matter now.

Mr. Nelson: On a point of order, Mr. Speaker. It will have become apparent to you during these lengthy exchanges that, although there has been strong criticism of the decision, especially from hon. Members for northern constituencies, no Back-Bench Member has supported the Government's policy, especially as it affects Gatwick and the south. Could I trespass on your generosity, Mr. Speaker, and ask you to allow me—

Mr. Speaker: Order. Had the hon. Member who represents Gatwick airport been present, he would certainly have been called. I must protect the other business of the House. It is impossible to call every hon. Member every time. I have gone well over the time that I normally allow—more than an hour—for Back-Bench Members, and I called many Conservative Members. It is unfair to try to raise points of order to continue questions on the statement—

Mr. Harry Greenway: On a point of order, Mr. Speaker.

Mr. Speaker: As I told the hon. Gentleman yesterday, he does extremely well.

Mr. Peter Bruinvels: Further to that point of order, Mr. Speaker. There are more than 40 Members of Parliament for the east midlands, and the East Midlands international airport was one of the major concerns—

Mr. Speaker: Order. I will now take a point of order on a different matter.
Later—

Mr. Greenway: On a point of order, Mr. Speaker.

Mr. Speaker: Very well—Mr. Greenway.

Mr. Greenway: I do not think there is any need to be cross about it; that is what we are here for, is it not? May we have some guidance on the way in which you measure the time that you are prepared to allow on statements? This afternoon, almost a record number of hon. Members rose, but the statement was not allowed a record time.

Mr. Speaker: I cannot give the hon. Gentleman any guidance on that. It is a matter of discretion, and I must make a judgment on the basis of the subsequent business on the Order Paper. The hon. Gentleman would have been deeply offended had he wished to speak in the subsequent debate but had been kept out as a result of my allowing the statement to run over time. On this occasion, the statement began at 3·41 pm and continued until after 5 o'clock, which I believe was a more than generous period.

Mr. Tony Favell: Further to that point of order, Mr. Speaker. With regard to the point of order raised by my hon. Friend the Member for Ealing, North (Mr. Greenway), will you bear it in mind in future that if there is not going to be a vote on such an extremely important matter, every right hon. and hon. Member who wishes should be given the opportunity to ask questions, especially if they represent constituencies such as mine, which will be adversely affected by the decision? This is probably the most important matter to come before the House this Parliament.

Mr. Speaker: There will be subsequent opportunities to debate the matter at Question Time, and there will be legislation in due course. I have already told the House —I keep my promises in this regard—that those who are unable to ask questions on statements are given preference when we come to debates. In fairness to other hon. Members, I cannot allow questions to continue for ever. If I did, we should never get our business finished.

Mr. Gregor MacKenzie: Further to that point of order, Mr. Speaker. Many hon. Members will know that, for some years, the length of statements has grown considerably, and I believe that you were extremely generous in your handling of the matter today. It is not the privilege of every hon. Member to be called every time he rises. That has frustrated many of us for many years, but you should appreciate, Mr. Speaker, that some of us understand how generous you are. Secondly, on a purely parochial note, we Members from Scotland would like to get on with our business.

Mr. Speaker: I am grateful to the right hon. Member. In deference to those hon. Members who have raised the


matter, may I say that I fully understand their anxiety. I am conscious of the fact that they have constituency interests in this matter. There will be other opportunities to discuss it, and hope that they will use them.

Falkland Islands (Member's Statements)

Mr. Bill Walker: On a point of order, Mr. Speaker. You will recall that I raised a point of order on 15 May, when I drew your attention to early-day motion 686 on a statement that the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) was alleged to have made during a visit to the Falkland Islands.
[That this House condemns the reported statement of the honourable Member for Carrick, Cumnock and Doon Valley that the Falkland Islanders lacked guts and calls upon him to withdraw the statement; and further calls upon him to give up his campaign of rewriting the history of the events before, during and after the conflict which is designed to justify his attitude towards the sending of the Task Force to restore freedom, the rule of law and democracy to the islands after the unprovoked invasion by the Argentinians.]
There is a letter in the Daily Telegraph today from the lady in question, Mrs. Pat Luxton. Bearing in mind the fact that the hon. Member for Carrick, Cumnock and Doon Valley was also reported as saying that he had evidence that sinking of the fishing boat Mhari L had been caused by a United States submarine, which has since been proved to be untrue, what procedure can be used to remove the uncertainty about the validity of those reports, since I have withdrawn my early-day motion?

Mr. Speaker: This matter was dealt with. Apologies were offered and accepted, and I cannot be concerned—

Mr. George Foulkes: rose—

Mr. Speaker: Order. I cannot be concerned with letters that appear in the press which may seek to reopen the matter. I shall allow the hon. Gentleman to comment, but then I must close the matter.

Mr. Foulkes: Further to that point of order, Mr. Speaker. I am worried by the fact that the hon. Member for Tayside, North (Mr. Walker) sought to link those two matters. I confirm that the account by Patrick Watts and Mrs. Luxton has been altered by them in three separate ways. First, they accept that there was no breaking of glass. Secondly, they accept that the Secretary of State for Defence was not involved. They have even now given a different version of what I am supposed to have said. Yet I have maintained consistently exactly what I said, which is supported by the hon. Member for Isle of Wight (Mr. Ross), who spoke to eye witnesses. I stand by what I said, notwithstanding what the lady said in her letter in the Daily Telegraph today.
As to the Mhari L, I made it clear that circumstantial evidence was given to me—[HON. MEMBERS: "Ah."] I made that quite clear. In the light of the inquiry, I am grateful for the opportunity of saying that the direct evidence shows that it was not a submarine. I fully accept that. I am surprised that the hon. Gentleman linked the two matters, and I am sure that he would wish to withdraw the implications of his doing so.

Mr. Speaker: Let us leave the matter there.

Local Authorities (Political Expenditure)

Mr. Roy Galley: I beg to move,
That leave be given to bring in a Bill to make provision relating to expenditure by local authorities for political purposes.
The object of the Bill is to ban the use of ratepayers’
and taxpayers’ money for politically motivated propaganda. Local authorities have a duty to inform the public about their services and to provide proper information services about their areas. Such activities have always been regarded as valid.
Before the reorganisation of local government in the early 1970s, considerable anxiety was expressed in a series of reports that the information activities of local authorities were too limited. Provision was then made in the Local Government Act 1972 to allow the development of a range of information services. There was a considerable development in publicity activities by local authorities after 1974. In recent years, however, those activities have grown enormously and extended beyond the scope of giving information to the dissemination of party-political propaganda.
Since 1980, we have seen a series of political campaigns by local government, many of them opposing Government policy on matters relevant to local government. They have included the abolition of the metropolitan county councils, rate limitation, the extent of council house sales, the Police and Criminal Evidence Act 1984 and many other topics. There have also been campaigns on matters unconnected with local government —nuclear disarmament, the miners’strike, the future of some industries, immigration controls, and so on.
In promoting such campaigns a wide variety of normal advertising techniques have been used, including leaflets, posters, stickers, advertising space on hoardings, the national and local press and, to a limited extent, radio and television. Such diversity makes it exceedingly difficult to identify all expenditure on political activities, but some figures are available.
As so often happens, the worst offender in regard to wasteful expenditure has been the GLC. Its current "awareness campaign" anticipates expenditure of £10 million over about three years. That sum is greater than the total expenditure of many district councils. West Yorkshire county council has spent approximately £600,000 campaigning against the abolition of metropolitan county councils, and the West Midlands county council has spent approximately £500,000. Large sums of money are now being spent on opposing the Transport Bill and on a plethora of other party political activities.
Justification for such activities is often based upon sections 111, 137 and 142 of the Local Government Act 1972. Those sections are widely drawn and do not include any control over party political propaganda of the type that we have seen recently.
There have been a number of court cases on those matters and so far none of them appears to have succeeded in curtailing the use of taxpayers’ and ratepayers’ money for those ends. Although expenditure under section 137 of the 1972 Act is limited, it is possible to justify considerable expenditure under section 142.
The lack of clarity in the relevant statutory provisions presents considerable difficulties to auditors in accounting for such local government expenditure. There is no adequate provision in law to distinguish between the dissemination of party political propaganda and the supply of unbiased information, which was clearly envisaged when the 1972 Act was passed. The Bill seeks to remedy that defect.
Apart from the supply of information, there are other matters of anxiety. Voluntary organisations outside the local authority structure are often used in campaigning by local authorities. Funds are often passed to them for campaigning. There is also a problem with the involvement of local authority staff in such campaigns as part of their day-to-day work. Staff can be pressured into participating in such activities when they wish to retain freedom of thought and action in party political matters. There are also instances of the establishment of trust funds controlled by political parties for party political ends.
A new height of outrage has been reached recently by the West Yorkshire county council with its biased approach. It has allocated ratepayers’ money for highway maintenance in areas on the basis not of need or fair treatment but of the political representation of those areas. All those matters could be dealt with in a Bill banning the use of ratepayers’ money for such political purposes.
There is clearly a requirement for local authorities to provide newsletters and newspapers to give information. If such publications were produced, the Bill would provide for equality of treatment between all political parties where political comment was seen to be proper.
There is plainly a major problem of definition in drawing the dividing line between what is information and what is politically motivated propaganda. There is a precedent, which the Bill could use, based upon the Independent Broadcasting Authority's code of standards and practices. That code expressly prohibits advertise-ments which are directed towards any political end, local or national, and which are not impartial on matters of political or industrial controversy or current public policy, local or national. That definition has worked well for the IBA, and it would form the basis of the definition in the Bill.
In our democratic society, reasonable people object to the use of public money for political purposes. There are sound reasons for their objections. The task of local government is to provide local services. In many instances, the publicity material produced has little to do with the provision of those services. Much of the recent publicity has flouted the long-held convention that public funds should not be used to gain party political advantage. Such expenditure involves the diversion of resources from the provision of services to the community. It is wrong to use scarce resources for party political propaganda when they should be used to provide services.
It is disgraceful that some councils claim that they have insufficient money to provide public services when they divert a great deal of money towards gaining political advantage. Such party political propaganda means that public debate is diverted from Parliament. Extra-parliamentary activity on that scale tends to undermine the role of Parliament.
What further offends ideas of fair play is that the information in so much of the publicity material is often


based upon unsubstantiated allegations and is rarely grounded in fact. It is designed to play upon the emotions and arouse unjustified fears.
The time has come to prevent the use of public money on party political objectives. The political debate must be encouraged, but when people wish to put forward party political views they should raise funds to do so. To steal money from the public to further political objectives is a national disgrace, and it must be ended as soon as possible. I commend the Bill to the House.
Question put and agreed to.
Bill ordered to be brought in by Mr. Roy Galley, Sir Paul Bryan. Mr. Marcus Fox, Mrs. Jill Knight, Mr. Gary Waller, Mrs. Elizabeth Peacock, Mr. John Butterfill, Mrs. Edwina Currie, Mr. Michael Brown, Mr. Geoff Lawler, Mr. Tony Favell and Mr. Derek Conway.

LOCAL AUTHORITIES (POLITICAL EXPENDITURE)

Mr. Roy Galley accordingly presented a Bill to make provision relating to expenditure by local authorities for political purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 5 July and to be printed. [Bill 154.]

Orders of the Day — Rating (Revaluation Rebates) (Scotland) Bill

Considered in Committee

[SIR PAUL DEAN in the Chair]

Clause 1

RATES REBATES

Mr. Donald Dewar: I beg to move amendment No. 1, in page 1, line 5, leave out 'may' and insert 'shall'.
The amendment has the virtue of being short and simple.

Mr. Albert McQuarrie: Hear, hear.

Mr. Dewar: I knew that that would immediately appeal to the hon. Member for Banff and Buchan (Mr. McQuarrie). We constantly think of him, particularly when we are looking for some old-fashioned Tory independence, as we are in this debate.
The Bill says that the Secretary of State may provide for revaluation rebates. We suggest that the discretionary "may" should be made a mandatory duty on the Secretary of State and that he should operate a similar system in future years.
We are returning to a point with which the Committee is familiar. It is the problem of what is to happen in the remaining part of the quinquennium once the rescue package for 1985–86 is behind us. We say that there is considerable merit in trying to ensure that the Government are committed to continuing relief—I shall deal later with the objections that are likely to be made by the Minister—during the remainder of the quinquennium. It would be thoroughly unsatisfactory if there were help in 1985–86, but nothing in subsequent years. The Bill does not preclude the possibility of further help, but there is no guarantee that it will be forthcoming. It is common sense that Parliament should put that right. I note that the Under-secretary of State is messenger boy for the Secretary of State again today — the right hon. Gentleman is not here; he is quite a stranger in Scottish debates these days. We regret that fact.

Mr. McQuarrie: The Secretary of State is doing a job in Scotland.

Mr. Dewar: I should be happy if the right hon. Gentleman were doing a job in Scotland, though if he were, he would, once again—because of his policies— be out of step with everyone else in Scotland.
If it is necessary to have the rescue package, which was not contemplated a few short months ago, in the current financial year, why is such a package not necessary for future financial years? Give or take one or two minor adjustments, we shall have the same valuation roll for the next five years. If we do not get a guarantee that the system


will continue, there will be considerable help in the current financial year and the full force of the revaluation will suddenly fall on those who are getting some assistance, limited though it is, under the Bill.
The Under-Secretary might argue that rates could decrease if local authorities would cut their expenditure and reduce their services to the public. I might say that rates could be reduced if the Government would restore the rate support grant that they have filched over the years. A third party looking at the exchange might say that it was an arid argument—and I might have sympathy with that view.
Let us compromise by saying that it is almost self-evident that the possibility of a substantial decrease in rates in the next year or two is one on which, to say the least, we cannot count. We can apportion the blame for that on another occasion.
The Bill seeks to deal with what are seen as inequities arising out of the revaluation. However, is it fair that a householder should be faced with a threefold or fourfold increase in his rateable value while others face increases only twofold? Why should a business suddenly be faced with an enormous sevenfold or eightfold increase in its rateable value while its competitors are more lightly treated?
The Government have said that they will remove the peaks and even out the effects of the revaluation. They are aiming to alleviate the wide variations. However, if the Bill is aimed at dealing with the individual disasters and horror stories that have arisen from the vagaries of the revaluation process, the exercise should be repeated each year.
The Under-Secretary may say that our proposal is unfair and is far too rigid, because it would commit the Government to maintaining a system based on a multiplier of three times the pre-valuation rateable value. If that stops hon. Members supporting the amendment, they should turn their attention—their support would be welcome— to amendment No. 3, which would allow a variation of the multiplier in the Bill. Putting the multiplier in the Bill, rather than leaving it to the statutory instrument, itself creates inflexibility, but the Government have decided on that course and we have to live with it.
The other argument that may be used by the Minister is that these matters should be left to the discretion of the Secretary of State and that we can rely on his good judgment and his perception of what makes political, social or economic sense in Scotland. The sad truth is that this matter is not within the discretion of the Secretary of State. As I pointed out on Second Reading, that fact was brutally brought to our attention by the Chancellor of the Exchequer on his foray to Perth for that gathering of the faithful which the Tories dignify with the name of a conference. The Chancellor then made it clear that he was —I use his phrase—"bailing out" the Secretary of State. He said that there were no more moneys likely for Scotland next year and added:
I do not think the Secretary of State will find me in the same compassionate, open-handed and generous mood next time.
5.30 pm
It is clear, therefore, that the Treasury will have a considerable say in what happens in future. I give Conservative Members credit for wanting to see this system continued for the rest of the quinquennium. The

trouble is that the Treasury might mount a punitive expedition against the Scottish Office on this matter, and the Treasury often wins.

Mr. Michael Forsyth: Is the hon. Gentleman aware that it is possible for the Secretary of State to meet the obligation as part of the rate support grant, without the Chancellor having to bail him out? The problem this year was that the rate support grant had already been determined.

Mr. Dewar: I accept that the hon. Member for Stirling (Mr. Forsyth) is producing a solution, but in doing so he is inviting the Secretary of State to find the money at the expense of local government services, and that is not acceptable to my hon. Friends and me. It would be going back to the so-called "first help from the Secretary of State" scheme, when the domestic element was raised to 5p in the pound.
I do not know how many Conservative Members have bothered to look up the details, but the hon. Member for Stirling will remember how the Secretary of State made a great virtue of the help that he was giving, when in reality £19 million came from the Secretary of State and £31 million came from the unfortunate local authorities. The remainder came from the proceeds of industrial derating from 50 to 40 per cent.
If it is said that we can make progress by cutting services in that way, the hon. Member for Stirling must realise that such a suggestion is totally unacceptable to Labour Members. The whole point about the £50 million —I wish to be fair to Ministers because they made a tremendous virtue of it at Perth and elsewhere—was the claim by the Government that it was new money and that it represented a victory at the expense of the Treasury. We can on occasions be generous, and that is why on this occasion Opposition Members are fighting to preserve the victory of the Secretary of State and want to help him beat off a counter-attack by his rapacious colleague, the Chancellor of the Exchequer.
Conservative Members would do well to consider the impact of a sudden withdrawal of the concession. Consider what would happen if the Treasury won the battle for the financial year 1986–87 and instead of £30 million—or whatever the figure may be that will be paid out of the £50 million; we shall debate that whole issue later — suddenly nothing was available.
In those circumstances, the electoral impact would be considerable. I trust that nobody will suggest that Conservative Back Benchers are above such political considerations; too many of them are looking nervously over their shoulders at their electoral prospects, and discouraging they are. I recommend them to consider the practical impact of allowing this help to be discontinued after the current financial year.
There is, therefore, political common sense in what I am arguing. However, it is also a matter of equity, particularly for commercial ratepayers, who are the main beneficiaries under the scheme. There is much to be said for people knowing that they will have this help for the remainder of the quinquennium, because uncertainty will leave them contemplating potential increases in rating bills of perhaps £10,000.

The Parliament Under-Secretary of State for Scotland (Mr. Michael Ancram): How does the hon. Gentleman think that the amendment would achieve the purpose that he has described?

Mr. Dewar: The amendment would place a duty on the Secretary of State—

Mr. Ancram: Answer my question.

Mr. Dewar: The Minister will have an opportunity shortly to put his case, and, as is often the case with Opposition amendments, he may have some clever points to make. He may try to defeat it on the grounds that his lawyers and back-room boys have come up with interesting points on how it would fail to achieve the purpose that I have described. I am led to believe that that will be the case as I see the Minister examining a carefully typed script.
There may be something wrong with the drafting of the amendment. If the Minister accepts it in principle and promises to introduce an amendment in another place to give effect to what we have in mind, I will willingly withdraw it. But if the Government will not give a guarantee that they are committed to the principle of maintaining this situation throughout the quinquennium, we shall mark our view on the matter. That is why we wish to place a statutory duty on the Secretary of State to continue the system for the remainder of the quinquennium.
As I said at the outset, we are discussing a simple issue. The amendment, which would be supported by the general body of ratepayers in Scotland, should be accepted by the Minister.

Mr. Gavin Strang: I support the remarks of my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar). Many people in Edinburgh will benefit from the Government's concession. This is the first opportunity that I have had in the House to welcome the concession. I welcome the Government's action in providing for ratepayers at the extreme end of the spectrum in terms of revaluation. Unfortunately, however, the concession does not go far enough.
It is crucial for the people of Edinburgh to know that this protection, limited though it is, will be maintained for some years to come, because we must raise local authority expenditure in Edinburgh to levels more comparable with those of other authorities. Our services in Edinburgh— our recreational assets, housing and so on—have been screwed down intolerably and have been allowed to deteriorate in recent years to an extent which may be unique in Scotland. Indeed, that is the basis of the present confrontation with the Government, who are intent on imposing a Tory budget on the majority Labour council in Edinburgh.
Edinburgh's services and general standards will be raised sooner or later. I believe that that will happen sooner, even before Labour wins the general election in two or three years from now. As my hon. Friend the Member for Garscadden pointed out, we must consider the period between now and the end of the revaluation period. That is why it is important to know that this concession, which does not go anywhere near far enough—it is a blunt instrument and is no alternative to the real solution, which is reversing successive Government cuts in local government expenditure — will continue to the end of the quinquennium.
I do not expect the Minister to show sympathy or understanding for the plight of the people of Edinburgh, who have suffered under Tory rule in recent years. I hope, however, that he will at least respond on the narrow issue of the future protection which hard-hit ratepayers would obtain as a result of the amendment.

Mr. Bill Walker: This is a tempting amendment. I listened with interest to what was said about it by the hon. Member for Edinburgh, East (Mr. Strang). My hon. Friend the Under-Secretary of State for Scotland will, I hope, confirm that neither the amendment nor the clause will affect my constituents, many of whom will be registering appeals against the new valuations. My hon. Friend will be aware, as he has received all the papers, that I have carried out a detailed study of the matter. The study shows clearly that many of my constituents will be successful in their appeals. The question is how long it will be before decisions on those appeals are reached.
The Bill will to some extent mitigate hardship this year, and we are grateful for that help, but appeal decisions may not be reached until next year. That is causing considerable concern, particularly in Angus. Expenditure in Angus has never been at a very high level, nor, for that matter, has it been very high in Perth and Kinross. The expenditure programmes of these authorities have been very carefully worked out. The changes that have taken place, particularly in Angus, are the direct result of the revaluation anomalies. Therefore the Opposition amend-ment is tantalising and I look forward to hearing what my hon. Friend has to say about it.

Mr. Malcolm Bruce: May I follow up the point made by the hon. Member for Tayside, North (Mr. Walker). Some small businesses will look at this package and think that it will solve their problems, but eventually they will find that it has solved their problems only for this year. The very large rate increases that they fear will still apply next year, unless the Government enter into a commitment to continue the present arrangement. If small businesses do not realise this and do not lodge an appeal this year, they will find that next year it is too late. Either the Government must be prepared to continue this arrangement or, if they are unable to make that commitment, they must use their good offices to ensure that people appeal against the valuation if they believe that it is too high. We have heard of circumstances in which people might be persuaded not to appeal because they are to receive the full benefit of the adjustment this year— an almost exact adjustment in terms of their valuation. However, the consequence is that next year they will suffer.
Although we welcome this measure in principle, it could be just a stay of execution. If the Government are not prepared to accept in principle the amendment of the hon. Member for Glasgow, Garscadden (Mr. Dewar) they should at least make it clear that they intend to continue the arrangement, if they possibly can, and that people should appeal, regardless of the present arrangement, in order not to forfeit their right to future adjustments.

Mr. Michael Forsyth: If my hon. Friend the Under-secretary of State is not prepared to accept this amendment, I hope that, having embarked upon a scheme for providing relief for small business men, he at least


recognises that it is essential for any small business to know what its position in future years will be and to be given at least some indication of its likely overheads. Just as the principle which guided his hand in introducing this Bill was the nature of the uncertainty and the nature of the impact on cash flows of a sudden and unexpected rates increase, so, equally, I ask my hon. Friend to recognise that businesses will be looking for certainty.
I hope that my hon. Friend will be able to say whether this scheme is expected to continue. My constituents would prefer to know now whether they will receive no relief next year rather than to be faced with a nasty surprise later. If my hon. Friend is not prepared to accept this amendment, which would be binding upon him, it is important that he should say what is to happen next year.

Mr. Hugh Brown: The Committee is indebted to my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) for moving this amendment. I have to admit that even after 20 years as a Member of Parliament I do not know the difference between "shall" and "may", but I do not suppose that is a matter of fundamental importance in terms of the information that we are trying to obtain from the Minister. It is accepted generally that annual provision is now made for the relief of domestic ratepayers. As relief for commercial ratepayers is to be introduced, it ought to be possible to assume that annual relief will be provided for them, too.
The Government have been rushed into introducing this legislation. I do not know whether businesses which will go out of existence unless relief is provided for them this year will be able to continue in business if relief is not provided for them next year. I hope that the Minister can provide information about what prompted the Government to introduce this measure. Were they prompted to introduce it because of genuine hardship and because it was suspected that without relief certain businesses would go out of existence, or were other factors involved?

Mr. Bill Walker: The hon. Member for Glasgow, Provan (Mr. Brown) is making a very important point which must be discussed. The evidence I have submitted to my hon. Friend the Under-Secretary of State includes evidence which shows clearly that in the past five years the net profits realised by businesses were less than the increase in rates that they will be forced to pay. There is no way, therefore, in which those firms could remain in business and be viable.

Mr. Brown: As upholders of the capitalist private enterprise system, perhaps they should not be in business. I do not have access to the information held by the hon. Member for Tayside, North (Mr. Walker), but the Government should be in possession of this information by now. I am assuming that the Government have been given a great deal of evidence about businesses that have suffered rates increases that are so savage that they will have to go out of business because the increases are greater than their profits.

Mr. John Maxton: That is true not only in the commercial sector which the hon. Member for Tayside, North (Mr. Walker) is delighted to support. Those who are engaged in the teaching profession in my constituency will receive no relief under the Bill because

their rates increases are not sufficiently large, but the increase in their rates will be higher than the increase in salary that this Government are prepared to concede.

Mr. Brown: I do not intend to follow up that point. It goes a little wide of the amendment. I should be grateful if the Under-Secretary of State would provide the information that I seek. I should be grateful for evidence upon which the change for this year is based so that we may judge whether such a change would be desirable next year and in subsequent years.
If the Minister cannot or will not say, can we assume that it is because there is some possibility of totally abolishing liability in the commercial sector? Is that part of the review now being undertaken, and is that why he cannot say what might or might not happen next year?

Mr. Gordon Wilson: The hon. Member for Glasgow, Garscadden (Mr. Dewar) is to be congratulated on his gallant effort to attack the Government on their future intentions towards the scheme. But whether the amendment is effective is neither here nor there. After all, a principle is at issue. The Government have been bounced into producing this scheme for good reasons that are partly political but partly due to the howls of discontent that have come from the commercial sector.
If the Government propose to make use of the scheme only for this year, there will be substantial problems next year, and the Government will have succeeded only in buying time for a year. However, they will have left a time bomb ticking away, and that could have deleterious consequences for small business men. Indeed, the Government owe it to the Committee to come clean and to say whether they intend to continue the scheme. If so, that will come as some relief to those in the commercial sector. It would also help if the Government could say whether, if they intend to continue it, they will also want a tapering effect so that the scheme will disappear during the current quinquennium or when the Government have produced an alternative scheme for financing local government.
If the Government proceed with their local government fund-raising reforms, they may well apply them to the domestic sector while leaving the commercial and industrial sectors untouched. If so, that is all the more reason why the bad effects of this revaluation should be diluted by the Government over a period.
In practice, the Government will not get many thanks from the commercial sector next year when the rates bills come tumbling in. People's memories can be very fitful, and although the Government may get some thanks for the relief that they are giving this year, they will run into a tirade of anger and abuse, such as they have had this year, if they fail to follow through with a coherent and consistent system to give aid to the commercial sector. The Government should come clean this afternoon and tell us exactly what they have in mind. It may not be▵ possibleto specify figures, but it is important that they should give some information about their future intentions.

Mr. John Home Robertson: rose—

Mr. George Foulkes: rose—

The Second Deputy Chairman of Ways and Means (Sir Paul Dean): Mr. George Home Robertson.

Mr. Home Robertson: I think, Sir Paul, that you have just called a composite hon. Member, but on this occasion I shall, if I may, take precedence over my hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes).
The amendment seems to be attracting quite widespread support, and I think that all those who have spoken have supported the spirit of it. Consequently, we all look forward to what the Minister will have to say about it. I feel that the amendment is right, because I do not want to give the present Secretary of State for Scotland any additional discretion. He is always only too willing to impose constraints of every kind on local authorities, yet when he wants to stick his nose in and to take direct action in the affairs of local authorities, he wants those powers to be purely discretionary.
There seems to be a manifest need for this relief not only this year but in succeeding years, and Parliament should therefore legislate accordingly. Incidentally, some of the constraints that the Secretary of State has imposed on local authorities in recent years have probably led him into this very morass. It is his actions in cutting rate support grant year after year that have put so many ratepayers in Scotland in such a parlous situation that the Government have been forced, through political pressure, to respond in this way. All hon. Members must recognise the dificulties that the Government have imposed on ratepayers and must be concerned about it. We must seek ways of alleviating the problems of ratepayers while at the same time preserving the quality of essential local authority services for those whom we represent.

Mr. Barry Henderson: The Bill will considerably help those whose valuations have increased threefold or more, but is it not true that for the great majority of ratepayers in Scotland, and particularly in Fife, the spending policies of local authorities have had more to do with increased rate bills than any revaluation?

Mr. Home Robertson: I do not have detailed figures at my fingertips, but I suspect that the hon. Gentleman's statement is inaccurate. If my part of the world is anything to go by, the rate increases imposed in recent years are related far more directly to cuts in the rate support grant than to anything that local authorities may have done. For example, in my constituency East Lothian district council has reduced the rate-borne element of its expediture in the current year, but as a result of the latest round of rate support grant cuts, the rates have nevertheless been forced up. The hon. Gentleman could not ask for a clearer example than that.
There is a case for this formula, flawed as it may be. But if it holds good for this year, it must also hold good for next year and the succeeding years. If there are anomalies and problems this year, those same problems will exist next year and the year after that. The Government may think that they have bought off Sir James Goold and all the others who have been making such a noise in recent months. Indeed, it may well be that this sum that the Chancellor of the Exchequer has been prepared to cough up as a one-off contribution can buy a little peace and quiet for Conservative Members this year. However, questions flow from that, to which we shall no doubt return. First, is that full £50 million actually going to be disbursed through this mechanism? Perhaps we should press the Government further on that.
However, the problem will be with us next year. Far be it from me to express too much concern about the future of Conservative Members, but yesterday I saw a prediction that was based on figures from recent opinion polls, which showed that only nine Conservative Members of Parliament for Scotland were likely to be elected at the next general election.

Mr. McQuarrie: On a point of order, Sir Paul. We are debating amendment No. 1, which was selected by Mr. Speaker. With the greatest respect I think that the hon. Gentleman has drifted away from it.

The Second Deputy Chairman: I have been listening carefully to the hon. Member for East Lothian (Mr. Home Robertson) and I hope that he was making no more than an incidental reference.

Mr. Home Robertson: I was trying to help the hon. Member for Banff and Buchan (Mr. McQuarrie), as he is not one of the nine Conservative Members who is likely to survive. However, if "shall" was substituted for "may", he might have a better chance—

Mr. McQuarrie: What about reselection?

Mr. Home Robertson: I have been reselected, but I do not know whether the hon. Gentleman has been. Indeed, it is interesting to note that the Secretary of State and the Minister could be casualties if they do not get the formula right. Even if they do not accept the obvious merits of the case for getting this business right now, perhaps they will accept them in the interests of self-preservation.

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Mr. Foulkes: It is a great pleasure to follow my honourable and patrician Friend the hon. Member for East Lothian (Mr. Home Robertson) on this matter.
I found the concern of the hon. Member for Stirling (Mr. Forsyth) for his constituents who have been affected very touching, especially as I have been reading reports — no doubt untrue—that because of the MORI poll findings he is looking for a seat in another part of the United Kingdom, unlike the hon. Member for Banff and Buchan (Mr. McQuarrie) who will fight to the bitter end in his area.

Mr. Michael Forsyth: I cannot imagine the source of those reports. I should be grateful to know where the hon. Gentleman read them.

The Second Deputy Chairman: Order. There is nothing to do with polls in the amendment. We must stick to the amendment.

Mr. Foulkes: It is interesting to note that the hon. Member for Stirling did not deny the reports. However, I shall change my tone because I am not a controversial person, as hon. Members know.
I thank the Minister for receiving a deputation earlier today, which I led, on behalf of the co-operative movement in Scotland. I declare my interest as a sponsored Co-operative Member. The Minister received the deputation with the greatest courtesy. He listened carefully to what was said and was diligent in answering our points.
The representatives argued strongly on a point that my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) argued cogently when he moved the amendment


—that help should be continued in successive years. The representatives warned the Minister—I think that he took the point because they mentioned stores in his constituency—that societies such as Scotmid co-op are having seriously to consider closing stores. It will interest my hon. Friend the Member for Edinburgh, East (Mr. Strang) to know that one store that may be closed is a modern supermarket in Granton, which was opened only a few years ago when I was on the board of the St. Cuthbert's co-op.
The representatives argued strongly for the continuation of this help to try to alleviate—and it is only a small alleviation — the problem. I do not think that it is improper to quote the Minister because he made his remarks in public. He said that the question of continuation would be considered in the autumn when such matters were generally reviewed.
I want to put some questions to the Minister. If the answers are outside his prepared text, I hope that he will deviate from it and answer them. It would be even better if he did not have a prepared text. In the discussions in the autumn, what will be his view and that of his right hon. Friend the Secretary of State for Scotland? Will they fight for a continuation of help? The House would like to know, as would the commercial ratepayers of Scotland. What will the Scottish Office do?
My second question is the most important: what will be the basis of any decision? What will be the criteron for continuing the help in future years? Will it depend on whether the money is made available? Will it depend on whether that money can be prised out of the Chancellor? I used that phrase when I met the Minister earlier today. Will it be based on the current year's experience? If there is any shortfall this year, will it be carried over to next year?
My hon. Friends and I suspect that the decision will be based on whether the heat has gone off the Government —whether Sir James Goold has forgotten about it and is not jumping up and down. Indeed, by then he might be Lord Goold. That is the traditional way of buying off people. Will the Government wait to test the temperature at the run-up to the next party conference? We need to know the criteria for the decision. I hope that the Minister can answer those genuine, serious and, I hope, to some extent, intelligent questions.

Mr. Maxton: When I listened to my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar), I was slightly undecided whether to support the amendment. From a political point of view, the amendment is pure altruism on our part. We have discussed what will happen to Conservative Members if the money is not continued in successive years. If it is not continued next year, when the Conservative party faces the regional elections in 1986, it will find that the ratepayers of Scotland are yet again up in arms against it.
I am tempted to say that I welcome that prospect because, unlike most of my hon. Friends, I have two Conservative regional councillors in my constituency. Of course, we shall take both those seats at the next election, but it would be much easier if the ratepayers of Newlands were up in arms against the Conservative Government.
However, I shall prove my altruism by giving my support to the amendment. Although it may not be the most beneficial action for the Labour party in Scotland, it is certainly beneficial for Scottish ratepayers.
I want to take issue with the hon. Member for Stirling (Mr. Forsyth) about his intervention in the speech of my hon. Friend the Member for Garscadden. He sugggested that next year the problem might be solved through the rate support grant rather than by continuing the rebate system. We would object strongly to that because that could be achieved only by a cut in the services provided by local authorities. Conservative Members keep saying that local authorities are overspending. They should come to my constituency and see the deterioration in housing, in cleansing and in other services provided by the local authority. They could not then say that the increases are down to high-spending authorities. That is nonsense.
The intervention by the hon. Member for Stirling was surprising. I assume that he still thinks that local authorities that he believes are overspending—including his local authority, Stirling district council—should be hit and receive less rate support grant than those authorities that he believes to be good authorities. If the Government were to adopt his scheme, his constituents who are paying high increases in their rates will not benefit next year because, presumably, the rate support grant will be cut. However, the constituents of the hon. Member for Strathkelvin and Bearsden (Mr. Hirst) may benefit because they have a good local authority that does not overspend.
I do not know what the hon. Gentleman thinks may be the solution. The rebate scheme is for the benefit of all ratepayers, no matter which local authority serves them. Surely that is what the hon. Gentleman wants, rather than using the rate support grant.

Mr. Michael Forsyth: Those of my constituents who suffered an increase in rateable value of more than three times would still benefit because the money would be available. The point about a reduction in rate support grant is perfectly apparent, and I am glad to have the hon. Gentleman's confirmation of that. The cuts in the RSG in Stirling district and Central region came about because those authorities decided to spend hundreds of thousands of pounds on striking miners and other political causes. The cuts in rate support grant are a result of their spending decisions, which will no doubt be reflected in my constituency in the regional and district council elections.

Mr. Maxton: It is obvious that the hon. Gentleman does not listen. I am not supporting cuts in rate support grant for Stirling district council. It has spent money on families of miners in desperate need, not on miners themselves, and many other local authorities rightly spent money in that way. Stirling district council should not have a cut in its rate support grant, but the hon. Gentleman thinks that it should. He said to my hon. Friend the Member for Garscadden that his constituency would suffer because of his Government's policies.
This scheme is fair and should be continued for the full five years of the revaluation period so that there is not a sudden dramatic increase in the rates. So far, we have not heard whether the Government will concede that point. We heard nothing from the Secretary of State when he made his statement or on Second Reading when the point was pressed. Today, no guarantee has been given that the scheme will continue. It will be interesting to see whether the Minister will give one.
If no guarantee is given, we shall have to say that the money was given this year for purely political purposes, and not with any real regard for ratepayers in Scotland. I am waiting with interest to hear what the Minister has to say.

Mr. Ancram: I am sure that the hon. Member for Glasgow, Garscadden (Mr. Dewar) was greatly relieved to hear that the hon. Member for Glasgow, Cathcart (Mr. Maxton) is to support the amendment, because not only is the hon. Member for Cathcart the Scottish Whip, upon whom the hon. Member for Garscadden depends to ensure that his troops do as they are told, but the hon. Member for Cathcart's name is on the amendment. Therefore, the House has the right to presume that he believed in what the hon. Member for Garscadden was saying.
For a moment, I wondered whether the hon. Member for Garscadden was having the same trouble as I had of not quite understanding what the amendment is meant to do, but that might be a minor matter. I ask that question out of interest because I wished to understand the amendment. I am sorry that the hon. Gentleman took it the wrong way and did not give me any answer, but perhaps he will consider doing so.
We have had a fairly wide-ranging debate. I always listen with interest to the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes). He spoke about people moving round looking for constituencies, but I remember his travels round Scotland before he finally settled in Carrick, Cumnock and Doon Valley. Both he and the hon. Member for East Lothian (Mr. Home Robertson) referred to polls. Given your strictures, Sir Paul, I shall not mention them, except to say that we heard precisely the same speech in precisely the same terms in 1981, but in 1983 some of the predictions made by Labour Members lay rather heavily upon them.

Mr. Foulkes: I am sure that the Minister will confirm that, once I found a constituency where the people wanted and elected me, I stayed there, and I shall continue to stay there. The Minister will recall that he used to represent another part of the country, but, when it gave him leave of absence, he flew elsewhere. However, we should get on to the subject rather than dwell on these political points.

Mr. Ancram: I agree. I merely regret that the hon. Member for Carrick, Cumnock and Doon Valley is no longer a constituent of mine, living in the nice, splendid and expensive house in which he used to live in my constituency.
My hon. Friend the Member for Tayside, North (Mr. Walker) spoke about appeals. In this connection it is important to reiterate what my right hon. Friend the Secretary of State said on Monday—that the Bill does not alter or affect valuations. If there are unfair valuations, or valuations that the ratepayers believe to be unfair, they should take advantage of the appeals procedure, because it is only through that that we can alter revaluations.
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As to the effect of appeals, some may take longer than it takes to bring the scheme into effect. I suspect that that will happen in the majority of cases. The scheme will relate to the valuations as at this time. If there is a successful appeal and a valuation is reduced below the three times multiplier, that case will fall out of the scheme in the future, and, if any adjustments are required to be made, they will be made at that time.

Mr. William McElvey: Will any repayment to the Secretary of State for Scotland be required from someone who has benefited from the scheme?

Mr. Ancram: In particular circumstances adjustments may need to be made. That will depend on the lime at which the appeal takes place and on the time that the valuation is changed.

Mr. Dewar: I am sure that I am on the same point as my hon. Friend the Member for Kilmarnock and Loudoun (Mr. McKelvey). If a ratepayer is paying in 10 monthly instalments, the first instalment of which is due in May, on the assumption that he has an appeal pending — unfortunately, valuation appeals take a long time to resolve—he may have had the benefit of the rebate on several instalments already paid. If at a later date he succeeds with his appeal, for unpaid instalments he would not have a rebate. However, would he have to pay back any money to the Secretary of State for a rebate to which he was not entitled earlier?

Mr. Ancram: The hon. Gentleman is talking about the same matter as I was in speaking of adjustments that might have to be made. This matter will be dealt with in the draft order. Adjustments will be made as a result of an appeal where the appeal has brought the valuation down below the three times multiplier. In effect, we would seek to ensure that no one unfairly benefits from the scheme. Therefore, where he has, in effect, been rebated, because of the success of his appeal he would have to make a payment back or an adjustment in some other way.
The various ways and timings under which this can arise do not allow for a simple answer. The important point, which I reiterate, is that ratepayers should not think that, just because they qualify for relief, they do not need to appeal if they have an unfair valuation.

Mr. Hugh Brown: The Minister seems to have confused me, if not the rest of the Committee. Is he saying that timing has something to do with when the decision on the appeal is made? I cannot understand the logic of this. If someone qualifies now under the Bill, and if there is a reduction in the rateable value on appeal, why should he not have his entitlement? Is the Minister trying to fudge that point, or does he not understand it?

Mr. Ancram: I understand the point, and I think that the hon. Gentleman will find, when the draft order is published, that it is covered. Where, after a rebate has been granted by the rating authority, any alteration is made in the rate value or in the pre-revaluation rateable value or in the revaluation rateable value itself—[Interruption.] The hon. Gentleman asked for a clear answer, and if he will let me finish my sentence, he may learn something —the grant of the rebate and the calculation of any such rebate would have to be determined anew, and the amount of any rebate already paid or allowed or of any rebate or balance thereof found to be due should be paid or allowed or repaid to the rating authority accordingly. There is no simple or clear way of dealing with this. The general effect that we are trying to achieve is that where someone has benefited, but because of an appeal does not require to have benefited and has actually made a surplus, a repayment would have to be made.

Mr. Jim Craigen: I understand what the Minister has said. Would he go as far as the


National Federation of Self-Employed and Small Businesses in saying that all applicants for relief must have lodged a formal appeal against the valuation?

Mr. Ancram: I would not go that far, and I am sure that on consideration neither would the hon. Member. What that suggests is that people who may well have a multiplier of more than 3, but who feel that the assessor's valuation is correct and who would therefore have no grounds for appeal, would be required at their own expense to make appeals to qualify for a rebate. I am sure that the hon. Member for Glasgow, Maryhill (Mr. Craigen) would not consider that sensible, in terms either of administering the scheme and trying to make sure that the appeal procedure is not bogged down or of the financial interests of those who were to undertake that course. I take it from the fact that the hon. Gentleman is nodding, however gently, that he appreciates that that would cause chaos and achieve no useful purpose.

Mr. Nicholas Fairbairn: I am worried about this. Let us take three cases: a person who has a multiplier of more than 3 who does not apply for any rebate; a person with a multiplier of more than 3 who applies for a rebate, who appeals and whose appeal is granted some time; and a person with a multiplier of more than 3 who appeals unsuccessfully and gets a rebate. What is the system under which these rebates are to be granted? Will one person have to repay? If ever there was an idiocy of a system, those three indications give it.

Mr. Ancram: The first case would not arise. Those eligible will be identified by the rating authority. They will be notified, and rebates will be paid where they are due. Therefore, there will be no question of someone qualifying, but not applying. If the rating authority leaves out someone, it is our intention that that person should be entitled to point out to the rating authority that he has been left out. There would be an application only in that sense.
In regard to the other two cases, in any scheme where relief is granted — not necesssarily by a successful appeal—and the ratepayer benefits overly, adjustments and repayments may have to be made. That may be done not by repayment but by adjusting the amount required to be paid over the rest of the year. I go back to what I said earlier to the hon. Member for Garcadden. The precise way in which adjustments would be made would depend on the circumstances and timing of the appeal.

Mr. Dewar: Another slight complication could arise. If someone is appealing, there is a statutory disregard which is a certain percentage of the increase. Presumably that would become an adjustment and would be called into play in the final reckoning. I cannot remember what the percentage is. Perhaps the Minister would remind me and explain how that would fit into the complicated scenario that he is outlining.

Mr. Ancram: I do not think it is a complicated scenario. It may be complicated in how it has to be phrased within the order, but the principle behind it is very simple. The figure is 10 per cent. In balancing the effects of a successful appeal, that would have to be taken into consideration to reach a fair result. In the case of those who have benefited but who do not require to have

benefited because they have appealed successfully, an adjustment may have to be made. I am sure that principle would be agreed by both sides of the Committee.
The hon. Member for Edinburgh, East (Mr. Strang) referred to expenditure in Edinburgh—a matter that we should probably not be debating in Committee. However, there is one relevant point to which I must reply. The spending decisions of Edinburgh district have increased the district rate by 80 per cent. In terms of the figures produced by the administration, that accounts for a considerable amount of the rate increases facing both domestic and commercial ratepayers in Edinburgh. In view of the concern displayed not only by the hon. Member for Garscadden but by the hon. Member for Edinburgh, East, I hope that the hon. Member for Edinburgh, East will support the Government in their attempts to persuade that district authority to reduce expenditure and to return money to the ratepayers.

Mr. Strang: I am grateful to the hon. Gentleman for the manner in which he made the point. I know that we cannot dwell on this at length, but if the Under-Secretary were to accompany me around my constituency he would see the dereliction and deprivation that exist because of the low level of provision by Edinburgh council over the years. He knows the position. There is no housing support grant; there is only a trivial contribution from the rates to the housing revenue account; and there is a very low level of expenditure on recreation compared with what is spent by some Tory authorities. We must be able to tackle the problems in Edinburgh. It is wrong for the Under-secretary to suggest that I am not supporting the council in beginning to tackle them.

Mr. Ancram: We shall have other occasions in coming months to debate those matters. I do not wish to debate them in the context of this Bill. If the hon. Gentleman is concerned about the ratepayers and the effects of rates on businesses, I find it hard to appreciate that he is content to see an 80 per cent, increase in the district rate merely to meet the expenditure decisions of Edinburgh district council.
The main point raised by the hon. Member for Garscadden was dealt with in a sense on Second Reading on Monday when both my right hon. Friend and I attempted to make clear that decisions as to future years are taken properly in the autumn of the year preceding the year in which they are to be effective. Decisions on rate support grant and on the domestic relief element of the rate support grant are taken then. I do not think that the hon. Member for Garscadden or the Committee could expect me to pre-empt those decisions. Hon. Members should not attempt to draw me into giving commitments about figures or any other details.
It was made clear on Monday, and I reiterate today, that the Bill is drafted as an enabling measure. By use of an order or regulations, it can be applied in any year. As I said on Monday, we intend to introduce the order relating to the current year as soon as the Bill has Royal Assent. We are entitled so to do.
Going back to what my hon. Friend the Member for Tayside, North said, there is nothing in the Bill to prevent the Secretary of State, if he so decides when he takes these decisions in the autumn, from providing relief in future years. That is an important and fundamental part of the Bill. I hope that my hon. Friends will accept that the


Secretary of State has the power. He has had other powers to help ratepayers in the past and he has used them. We have shown our concern for Scottish ratepayers, but the Bill provides the proper way, and I hope that my hon. Friends will accept it.

Mr. Foulkes: The Committee knows that the Bill gives the Secretary of State that power. Will the Minister answer my question: what criteria will be used and on what basis will the decision be made to continue the provision in future years?

Mr. Ancram: The decisions are taken in the autumn in the light of current circumstances. Relief to ratepayers is examined on an annual basis and decisions are announced in due course to Parliament. As my hon. Friend the Member for Stirling (Mr. Forsyth) said, businesses should have some idea of what is to happen. We shall let ratepayers know of our intentions in good time, as we do about other elements of the rate bill each year.

Mr. Craigen: The Minister says that he wants to let ratepayers know in good time. The closing date for appeals against valuation will be September. Is the Minister saying that he will announce his decision in October? If so, people who have put in an appeal will not have had the opportunity to examine his decision.

Mr. Ancram: The hon. Member for Maryhill is muddling two matters. The appeal will be to reduce a valuation. Those who feel that their valuations are unfair should appeal. The Bill does nothing to alter valuations, so the closing date for appeals has nothing to do with the argument.
I tell my hon. Friend the Member for Stirling that businesses will have some idea of the burdens that they are likely to face because we intend to make the decision as soon as possible, consistent with the timetable that I have outlined. They will have some warning of their position in future years.

Mr. Fairbairn: I should like to be clear about two matters. First, I assume that there will be no appeal against any assessment of abatement or non-abatement under the ordinary rating valuation procedures. Secondly, when the scheme is started, should I assume that, however unjust any part of the scheme is thought to be, we must vote for the whole or against the whole?

Mr. Ancram: My hon. and learned Friend will see from the face of the Bill that the regulations come under the affirmative procedure.

Mr. Fairbairn: So the answer is yes.

Mr. Ancram: The answer is yes. I understand that my hon. and learned Friend was referring to appeals by those who feel that they should have received relief but have not. The normal type of appeal applies to the Court of Session. The hon. Member for Garscadden laughs, but he got the answer right. He appears to find that humorous.
We want to maintain a degree of discretion and flexibility for future years by giving the Secretary of State the power, year to year, to make regulations which can provide relief under the Bill.
Opposition Members seem suddenly to have a tremendous desire to promote relief schemes for commercial ratepayers, particularly in the long term. I recall that in 1978, when the last revaluation took place,

when the Labour party was in government and the commercial sector was disadvantaged, the differential between the average multiplier and the commercial multiplier was greater than it is today. There was no sign then of promoting schemes to help the commercial or domestic ratepayers who were most severely hit. The only reaction of the Labour Government to the plight of domestic and commercial ratepayers was to reduce domestic relief by about 75 per cent.
We are grateful to Opposition Members for supporting the scheme, but some of their enthusiasm owes more to the politics of the situation than to a deep concern for the ratepayers.
The Bill provides a system which will not only help ratepayers this year, but is capable of providing help in future years, if required. I ask my hon. Friends to reject the amendment which does not achieve what the hon. Member for Garscadden wishes it to achieve. In many ways it does not make sense. If the hon. Member for Garscadden wishes to press the amendment to a Division, I ask my hon. Friends to reject it.

Mr. Dewar: I confess that the look of pain upon the face of the hon. and learned Member for Perth and Kinross (Mr. Fairbairn) as the Minister smoothly referred to an appeal to the Court of Session as a normal appeal lightened my afternoon.
I intend to press the amendment to a Division and I hope that my right hon. and hon. Friends will support me. If we carry the day the other place might have to do some tidying up, but I imagine that that can be done with ease if the view of the Committee is clearly established. I wish to press the amendment because it has all-party support. We agree that certainty is a virtue and that equity demands that the Government make it clear that they intend to carry the aid throughout the remainder of the quinquennium.
It is not good enough for the Minister to stand at the Dispatch Box with no supporting argument, detail or explanation and to say that the Government will take a decision in the autumn. He did not try to answer my hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) about the criteria.
There is a good reason why we should expect the scheme to continue. I accept that the domestic element is different because that applies to all domestic ratepayers. In that sense we are talking about an omnibus provision. Whether the domestic element should apply might be a matter to be considered according to the circumstances in October. However, the proposed form of rebate is an attempt to equalise or at least to reduce the discrepancies within a particular category. Nothing that happens in October will change that picture. The valuation roll in October will be exactly the same as the present valuation roll. If it is offensive—we gather that the Government rightly think that it is offensive—and inequitable that certain people should suddenly see an enormous gap opening up between their rateable value and the rateable values of other people, that gap will still be there in October. No change of circumstance will affect that situation.
If that is the injustice with which the Bill is dealing, it is an injustice which by definition will continue throughout the quinquennium, and there can be no reason for refusing to give an undertaking that at least in principle this help will be continued. If there were some caveat about the


level, we might be prepared to listen to that, but at least but there should be an undertaking that the discrepancies that will still exist will be dealt with as set out in the scheme.
Therefore, it seems to me clear, logical and entirely consistent that we should express our displeasure at the totally inadequate response of the Minister, and invite the Committee to divide.

Question put, That the amendment be made:—

Division No. 227]
[6.40 pm


AYES


Abse, Leo
Kaufman, Rt Hon Gerald


Archer, Rt Hon Peter
Kennedy, Charles


Ashdown, Paddy
Kinnock, Rt Hon Neil


Atkinson, N. (Tottenham)
Kirkwood, Archy


Banks, Tony (Newham NW)
Lamond, James


Barron, Kevin
Leadbitter, Ted


Beckett, Mrs Margaret
Lewis, Terence (Worsley)


Beith, A. J.
Litherland, Robert


Bell, Stuart
Lloyd, Tony (Stretford)


Bermingham, Gerald
Loyden, Edward


Boyes, Roland
McCartney, Hugh


Bray, Dr Jeremy
McDonald, Dr Oonagh


Brown, Gordon (D'f'mline E)
McKay, Allen (Penistone)


Brown, Hugh D. (Provan)
McKelvey, William


Bruce, Malcolm
MacKenzie, Rt Hon Gregor


Callaghan, Rt Hon J.
McTaggart, Robert


Callaghan, Jim (Heyw'd &amp; M)
Madden, Max


Campbell-Savours, Dale
Marek, Dr John


Canavan, Dennis
Marshall, David (Shettleston)


Clark, Dr David (S Shields)
Martin, Michael


Clarke, Thomas
Maxton, John


Clay, Robert
Maynard, Miss Joan


Clwyd, Mrs Ann
Meacher, Michael


Cocks, Rt Hon M. (Bristol S.)
Meadowcroft, Michael


Concannon, Rt Hon J. D.
Michie, William


Cook, Frank (Stockton North)
Millan, Rt Hon Bruce


Cook, Robin F. (Livingston)
Morris, Rt Hon J. (Aberavon)


Corbyn, Jeremy
Oakes, Rt Hon Gordon


Cowans, Harry
O'Brien, William


Cox, Thomas (Tooting)
Paisley, Rev Ian


Craigen, J. M.
Patchett, Terry


Crowther, Stan
Pavitt, Laurie


Dalyell, Tarn
Pendry, Tom


Davis, Terry (B'ham, H'ge H'l)
Penhaligon, David


Dewar, Donald
Pike, Peter


Dormand, Jack
Powell, Raymond (Ogmore)


Dubs, Alfred
Prescott, John


Duffy, A. E. P.
Radice, Giles


Dunwoody, Hon Mrs G.
Randall, Stuart


Eadie, Alex
Richardson, Ms Jo


Eastham, Ken
Roberts, Ernest (Hackney N)


Evans, John (St. Helens N)
Robertson, George


Ewing, Harry
Robinson, G. (Coventry NW)


Field, Frank (Birkenhead)
Robinson, P. (Belfast E)


Foot, Rt Hon Michael
Sheerman, Barry


Foulkes, George
Short, Ms Clare (Ladywood)


Freud, Clement
Silkin, Rt Hon J.


Gourlay, Harry
Skinner, Dennis


Hamilton, W. W. (Central Fife)
Soley, Clive


Hardy, Peter
Spearing, Nigel


Harrison, Rt Hon Walter
Stewart, Rt Hon D. (W Isles)


Hart, Rt Hon Dame Judith
Strang, Gavin


Hattersley, Rt Hon Roy
Thomas, Dr R. (Carmarthen)


Hogg, N. (C'nauld &amp; Kilsyth)
Thompson, J. (Wansbeck)


Holland, Stuart (Vauxhall)
Tinn, James


Home Robertson, John
Torney, Tom


Howells, Geraint
Warden, Gareth (Gower)


Hughes, Dr. Mark (Durham)
Wareing, Robert


Hughes, Robert (Aberdeen N)
Welsh, Michael


Hughes, Roy (Newport East)
Wigley, Dafydd


Hughes, Sean (Knowsley S)
Williams, Rt Hon A.


Janner, Hon Greville
Wilson, Gordon


Jones, Barry (Alyn &amp; Deeside)
Winnick, David





Wrigglesworth, Ian
Tellers for the Ayes:


Young, David (Bolton SE).
Mr. Frank Haynes and



Mr. James Hamilton.




NOES


Adley, Robert
Hirst, Michael


Alexander, Richard
Hogg, Hon Douglas (Gr'th'm)


Alison, Rt Hon Michael
Holland, Sir Philip (Gedling)


Amess, David
Holt, Richard


Ancram, Michael
Howarth, Alan (Stratf'd-on-A)


Arnold, Tom
Howarth, Gerald (Cannock)


Ashby, David
Irving, Charles


Baker, Nicholas (N Dorset)
Johnson Smith, Sir Geoffrey


Baldry, Tony
Jones, Gwilym (Cardiff N)


Bellingham, Henry
Knight, Gregory (Derby N)


Benyon, William
Knight, Mrs Jill (Edgbaston)


Best, Keith
Knowles, Michael


Blackburn, John
Knox, David


Bottomley, Peter
Lawrence, Ivan


Bottomley, Mrs Virginia
Lennox-Boyd, Hon Mark


Bowden, Gerald (Dulwich)
Lester, Jim


Boyson, Dr Rhodes
Lewis, Sir Kenneth (Stamf'd)


Braine, Rt Hon Sir Bernard
Lightbown, David


Bright, Graham
Lilley, Peter


Brinton, Tim
Lloyd, Ian (Havant)


Bruinvels, Peter
Lloyd, Peter, (Fareham)


Bryan, Sir Paul
Luce, Richard


Buchanan-Smith, Rt Hon A.
Lyell, Nicholas


Burt, Alistair
McCurley, Mrs Anna


Butcher, John
Macfarlane, Neil


Butterfill, John
MacGregor, John


Carlisle, John (N Luton)
MacKay, John (Argyll &amp; Bute)


Carttiss, Michael
Maclean, David John


Channon, Rt Hon Paul
McNair-Wilson, P. (New F'st)


Chope, Christopher
McQuarrie, Albert


Clark, Hon A. (Plym'th S'n)
Major, John


Clark, Dr Michael (Rochford)
Malins, Humfrey


Clarke, Rt Hon K. (Rushcliffe)
Malone, Gerald


Clegg, Sir Walter
Mather, Carol


Cockeram, Eric
Maxwell-Hyslop, Robin


Colvin, Michael
Mayhew, Sir Patrick


Conway, Derek
Mellor, David


Coombs, Simon
Merchant, Piers


Cope, John
Meyer, Sir Anthony


Cranborne, Viscount
Miller, Hal (B'grove)


Critchley, Julian
Mills, Iain (Meriden)


Crouch, David
Mills, Sir Peter (West Devon)


Dickens, Geoffrey
Moynihan, Hon C.


Dicks, Terry
Murphy, Christopher


Dorrell, Stephen
Neale, Gerrard


Douglas-Hamilton, Lord J.
Needham, Richard


Dunn, Robert
Nelson, Anthony


Durant, Tony
Neubert, Michael


Evennett, David
Newton, Tony


Fairbairn, Nicholas
Nicholls, Patrick


Fallon, Michael
Norris, Steven


Favell, Anthony
Onslow, Cranley


Finsberg, Sir Geoffrey
Oppenheim, Phillip


Fookes, Miss Janet
Oppenheim, Rt Hon Mrs S.


Forman, Nigel
Ottaway, Richard


Forsyth, Michael (Stirling)
Page, Richard (Herts SW)


Fowler, Rt Hon Norman
Patten, Christopher (Bath)


Fox, Marcus
Pawsey, James


Fraser, Peter (Angus East)
Peacock, Mrs Elizabeth


Gale, Roger
Pollock, Alexander


Galley, Roy
Porter, Barry


Garel-Jones, Tristan
Portillo, Michael


Glyn, Dr Alan
Powley, John


Gower, Sir Raymond
Proctor, K. Harvey


Gregory, Conal
Rathbone, Tim


Gummer, John Selwyn
Rhodes James, Robert


Hamilton, Hon A. (Epsom)
Rhys Williams, Sir Brandon


Hamilton, Neil (Tatton)
Ridsdale, Sir Julian


Hargreaves, Kenneth
Roberts, Wyn (Conwy)


Harris, David
Robinson, Mark (N'port W)


Hawkins, Sir Paul (SW N'folk)
Roe, Mrs Marion


Heathcoat-Amory, David
Rowe, Andrew


Henderson, Barry
Rumbold, Mrs Angela


Hicks, Robert
Ryder, Richard


Hind, Kenneth
Sayeed, Jonathan






Shaw, Sir Michael (Scarb')
Thompson, Patrick (N'ich N)


Shelton, William (Streatham
Thornton, Malcolm


Shepherd, Colin (Hereford)
Thurnham, Peter


Shersby, Michael
Tracey, Richard


Sims, Roger
Twinn, Dr Ian


Skeet, T. H. H.
Walden, George


Smith, Tim (Beaconsfield)
Walker, Bill (T'side N)


Speller, Tony
Waller, Gary


Spencer, Derek
Ward, John


Spicer, Jim (W Dorset)
Wardle, C. (Bexhill)


Stanbrook, Ivor
Watson, John


Steen, Anthony
Watts, John


Stern, Michael
Wells, Bowen (Hertford)


Stewart, Allan (Eastwood)
Wells, Sir John (Maidstone)


Stewart, Andrew (Sherwood)
Wheeler, John


Stradling Thomas, J.
Whitfield, John


Sumberg, David
Whitney, Raymond


Taylor, Teddy (S'end E)
Wolfson, Mark


Tebbit, Rt Hon Norman
Yeo, Tim


Temple-Morris, Peter



Terlezki, Stefan
Tellers for the Noes:


Thatcher, Rt Hon Mrs M.
Mr. Ian Lang and


Thomas, Rt Hon Peter
Mr. Tim Sainsbury.


Thompson, Donald (Calder V)

Question accordingly negatived.

Mr. Bruce: I beg to move amendment No. 2, in page 1, line 13, leave out '3' and insert '2·5'.

The Second Deputy Chairman: With this it will be convenient to discuss the following amendments: No. 3, in page 1, line 13, after 'value', insert
'or such other figure as shall be set by statutory instrument which shall not have effect until approved by resolution of the Commons House of Parliament'.
No. 4, in page 2, line 11, at end insert—
'(3A) Where at any time it appears to the Secretary of State that the expenditure for rebate under this section will not reach the sum of £50 million for which provision is made, he may by order reduce the multiples set at 3 under subsection (2) hereof so as to ensure that the said sum is utilised.'.

Mr. Bruce: The purpose of the amendment is self-evident. It is to ensure that the relief gets to the people who need it most. That has been the intention behind all the amendments tabled by Liberal Members.
It has emerged from our debates so far that no one seems to have accurate figures. The Under-Secretary of State made some play of the fact that at the time that the Liberal party was campaigning for exactly this kind of relief package we were asking for only about £4 million. He knows that that criticism of us was as much a criticism of the Scottish Federation on Small Businesses and Self Employed which had assessment information available to it that that is what would be required—[Interruption.] It has emerged since that such organisations as the Liberal party and the federation, without the aid of computers, are no more inaccurate than the Government, who have the aid of computers—[Interruption.] The braying of the hon. Member for Banff and Buchan (Mr. McQuarrie) is a matter that I may come to later.
The Minister is aware that the figure of £50 million was not the first-aid relief of Mafeking, as was suggested at the Tory party conference, and a definitive figure produced by the Scottish Office on the basis of a detailed analysis. It appears now that it was at best a guess that it was hoped would cover the requirement, and that it was a generous guess. We are not ungrateful that the Scottish Office managed to squeeze a generous sum of money out of the Treasury. However, we want to ensure that the money is used for the purpose for which it was intended and that those who need the relief most will get it.
Regrettably, the Government's cut-off point of three times the increase in net annual value means that many people who need the relief will not get it. I have received a number of representations from people who face very considerable increases in their rates bills and will qualify for no relief.
I quote the example of someone living in New machar, just outside the city of Aberdeen, who faces a 288 per cent. increase in rateable value and an increase of 26·2 per cent, in the rates that he must pay. He asks me to make representations to the Government to give him relief from that. The Government are pushing through this Bill which will give him no relief. He will have to pay the full increase.
The hon. Member for Glasgow, Cathcart (Mr. Maxton) spoke earlier of a comparison with teachers. I can assure the Minister that it is not lost on teachers who are also ratepayers that they face rate increases of 25 per cent, or 30 per cent, in circumstances where at the moment they are getting no salary increase and what the Government are offering them will not cover their rates bills.
One of my constituents lives in Ellon in a house which may have been sold to him by the hon. Member for Banff and Buchan. He faces an increase in his rateable value from £457 to £1,247. That is 273 per cent. The increased cash payment that he must make is 30 per cent. He, too, will get no relief under the terms of the Bill, and nothing that I or the Minister can tell him will make him feel very well disposed to the circumstances in which he finds himself.
The third example that I quote is that of someone living in Bridge of Don who is asked to find an additional £250. My calculation is that that might be reduced to £220, and he points out that that is just £30 less than the rates bill that Balmoral castle will have to find, which suggests that living in a big house in the country may be cheaper than living in a small house in a town.
I hope that those examples demonstrate to the Committee that the cut-off point that the Government are applying means that many people who, understandably, are incensed by their increased rates bills and worried about how to find the means to pay them are to get no relief.
It could be argued that the 2·5 suggested in the amendment did not go far enough but not that it went too far. I accept that, because it was essentially a compromise based on my understanding of the kind of shortfall that might be available and the intention to concentrate the money available a little closer on the people who needed relief.
On more than one occasion the Minister has implied that I, as distinct from my colleagues, did not appreciate the Government's offer of help. He knows that my colleagues and I have campaigned hard for a first-aid package. At a press conference in Edinburgh on 9 May, before the Government's announcement, I said that I thought that the relief necessary would be of the order of tens of millions of pounds because it was apparent to me that the figures would be fairly substantial.
I welcome the Government's package, but I make two comments about it. The first is that the package is not concentrated hard enough where it is most needed. It is applied across the board, and many people will still have dramatic increases in their rate bills with no additional services, and relief for one year only. If we are talking about real politics, I can assure the Minister that those


people will not be better disposed towards the Conservative party after the passage of the Bill than they were before. They will be looking for more help than they have had to date. The Government will have to restore some of the rate support grant to local authorities next year to enable them to cushion their ratepayers.

Mr. Henderson: If the hon. Gentleman thinks that the Government's introduction of the Bill demonstrates a warped sense of priorities, surely by this amendment he is seeking to warp the priorities even more. Is not that curious? Would it not be less necessary if Liberal councillors on Fife regional council had voted against expenditure policies exceeding the Government's guidelines put forward by the Conservative members of that council?

Mr. Bruce: I am sure that the hon. Gentleman's constituents are well aware of the value of having Liberals on the local council, which is probably why about the safest Conservative seat on the district council is now in Liberal hands. That suggests that when people have Liberal councillors they appreciate them and elect more of them, as no doubt they will in other parts of the country.
On the question of warped priorities, I freely admit that I might have chosen my words better in response to the statement. Let me therefore make my point clear. The Government managed to find £50 million of new money. It was not scientifically calculated, but a figure that they thought would be adequate.

Mr. Donald Stewart: It was not calculated at all.

7 pm

Mr. Bruce: I agree with the right hon. Gentleman on that.
Secondly, the Government rightly recognised that the money was necessary and managed to find it, having told us that there was no new money available for other priorities in the Scottish economy, such as investment in education. The Government are not going far enough. If they can find £50 million for ratepayers, they should be able to do so for teachers. I assure Conservative Members that my constituents recognise, as the Committee will recognise, that the Government's priorities are peculiar to them. They do not accord with what many people believe, that is, that we should be protected from these ridiculous rate increases, which have been brought about as much by cuts in Government rate support grant as by revaluation, and that the Government should invest in other priority services, such as education. It is valid to make the point that if the Government can find money for rates, they can find it for education.
I have attended meetings in my constituency, which were extremely well attended by ratepayers, who will now campaign consistently for a restoration of justice within local government finance to enable local authorities to operate effectively and to carry out what they should do with proper support from central Government, which they are not receiving at present. Those people recognise the true colour of the Government's priorities.
The Minister should acknowledge that the £50 million was not calculated scientifically, that its application is not

getting it through to those who most need it, and that some people who face substantial rate increases will not be helped by the legislation.
The amendment would lower the threshold and give more people assistance. To quote the hon. Member for Cathcart, the political altruism of my party is that the amendment may help some of the Minister's disaffected supporters, who are outraged and no doubt wrote to him about the iniquities of the rating system, to feel that the Bill will benefit them, which it does not do as it stands. I would have thought, therefore, that Conservative Members would be anxious to ensure that the relief is spread as widely and among as many ratepayers as possible. To lower the threshold would achieve that end. It must be desirable both for general equity and, indeed, for Conservative Members in marginal constituencies.

Mr. Dewar: As three amendments are grouped together, it may be helpful if I speak to amendment No. 3 in my name and the names of my hon. Friends.
We are dealing with the same point as that raised by the hon. Member for Gordon (Mr. Bruce)—the mystery of the £50 million. The headlines told us that the Government had found £50 million, which was new money and would be used to help Scottish ratepayers. When the Prime Minister spoke at Perth about the commercial element in the package, she went out of her way to say that the scheme would cost "£40 million, at least." A great deal of political credit was claimed for having produced that £50 million. We are making the straightforward point that the goods should be as advertised. If the package was £50 million, it should be used for relieving the burden of the rating system at the point where that system creates most pressure.
When the hon. Member for Edinburgh, South (Mr. Ancram) replied to the debate on Monday, he said of the scheme:
It is not easy to calculate how much that will cost, as hon. Members have realised. I believe that we shall not know the full answer to that question until all those who are eligible have been paid."—[Official Report, 3 June 1985; Vol. 80, c. 112.] 
That is a highly questionable statement.
I accept that there may be some play on the estimates and that we may have to come and go on the £29·5 million or £29·6 million which COSLA calculated. However, it is extraordinary that, during the preparation of the scheme, COSLA was not consulted. COSLA holds the computer records and has the capacity to identify those who will benefit and the amounts that will have to be paid to them. Its figures are likely to be accurate within a small tolerance. COSLA strongly suggests that the shortfall will be about £20 million.
In the debate the Secretary of State said:
While it looks as if the total cost should indeed be contained within the £50 million figure attached to the Bill and may be a bit less, it is not possible yet to be sure what it will amount to". —[Official Report, 3 June 1985; Vol. 80, c. 66.]
We must make provision against the possibility — indeed, the strong likelihood — that COSLA's figures will be correct, and the suggestion that the sum may be a little less than £50 million is a euphemism. There appears to be a genuine danger that £20 million of the £50 million rescue operation will not be given to Scottish ratepayers, but will disappear into the ever-hungry maw of the Treasury.
I like amendment No. 3 because it allows a sensible degree of flexibility. It is a genuine attempt to help. The


hon. Member for Gordon fairly suggested—in the sense that it was a genuine suggestion—that we should bring more people into the ambit of the scheme. He suggests reducing the multiplier from 3 to 2·5. I cannot support that because it is too arbitrary a figure and too inflexible in its effect. 1 cannot say what would happen with a multiplier of 2·5, but COSLA has informally suggested to me that it would include an enormous number of people and that the £50 million would have to be increased many times. In a sense that is desirable, and I understand the temptation to do that. However, 1 have tabled an amendment which I genuinely hope the Government will accept, and Conservative Back-Bench Members will support.
Amendment No. 3 is much more modest than amendment No. 2. We are not demanding an arbitrary reduction; we are seeking, in case our suspicions turn out to be right and £20 million is to return to the Treasury and not spent as intended, to introduce a provision to give the Secretary of State the machinery to do something about the shortfall. When he has calculated at leisure how best to proceed by varying the multiplier or whatever, he may say, "I am sorry chaps, but I cannot do anything about the shortfall. I would have liked to, but the primary legislation was drawn in a way that did not allow it." For a long time he sheltered behind that proposition regarding the scheme itself. I am anxious to help by providing him with such a means, if it becomes clear that that is right because of the enormous shortfall caused by the present multiplier.
The amendment allows the multiplier to be varied by statutory instrument in the same way as the other details of the scheme. We are not being unreasonable; we are merely giving the Secretary of State a power. The amendment is permissive. We are allowing the Government to cope with what would be a sad let-down if the figures fall far short of the promised support.
Conservative members have already commented on the extremely limited impact of the scheme in their constituencies. The hon. Member for Strathkelvin and Bearsden (Mr. Hirst) reported, sadly, on the disappointments for Bearsden. To some extent, I appear at the Dispatch Box as a penitent because in the early days of the scheme I suggested that the Eastwoods and Bearsdens would be the principal beneficiaries. That has not turned out to be true, and I concede that. The figures show a much wider scatter than I thought likely, although the level of help is marginal.
I discussed the figures with the hon. Member for Eastwood (Mr. Stewart), the Under-Secretary. They were supplied to me by the finance division of Strathclyde region. I give them to the Committee because they are interesting. In Glasgow, for example, 11·95 per cent, of all domestic ratepayers will get some benefit, although probably marginal, from the scheme. In Eastwood, only 197 householders will qualify for assistance, which represents less than 1 per cent, of the domestic ratepayers in that area. There is a great contrast between Glasgow at almost 12 per cent, and Eastwood at 0·98 per cent. The total of £59,000 that will be available in Eastwood shows how marginal the assistance is.
It is interesting to note that, in Glasgow, 23 per cent, of non-domestic ratepayers will obtain some assistance from the scheme, whereas in Eastwood only 1·06 per cent., or 21 properties, will benefit. When the Eastwood Gazette, or whatever the local newspaper is called, gets its hands on those figures, the Under-Secretary of State may have an uncomfortable time explaining why there has been

such a minimal impact in his area. In Argyll and Bute, which is represented by another Under-Secretary of State for Scotland, 1· 35 per cent, of domestic ratepayers will be helped, compared with an average in Strathclyde of more than 6 per cent. That suggests that the help for Argyll and Bute will not be received with massive enthusiasm.
I make those points because I believe that the record should be put straight, and because I wish to underline the fact that, if the scheme is extended, it will be extremely popular in areas that are important to Ministers, especially Eastwood and Argyll and Bute. I have obtained only the figures for Srathclyde, but perhaps if I obtained those for Angus, the portly frame of the Solicitor-General for Scotland might bounce a little more happily, given the electoral pressure from (which he suffers, when the multiplier was lowered and the present scheme extended.
It will be frustrating and irritating for constituents to have to say to their representatives, "Not only are we getting only a marginal benefit from the scheme and being left with substantial rate increases, but we know that another £20 million is available, which will be handed back to the Chancellor and will not benefit Scottish ratepayers. Why can you not take up that extra £20 million by adjusting the scheme?" At that point, the Under-secretary of State—the hon. Member for Eastwood— and other Ministers will be grateful for the fact that this amendment has been accepted, because they will have the machinery to vary the scheme and to use all the available money. They need not go again to the Treasury, because the money is there. It must be good sense to change the scheme so that the Scottish Office can use all the available money.
I hope that that simple, but persuasive and compelling, case will commend itself to Conservative Members. We know from Second Reading that the hon. and learned Member for Perth and Kinross (Mr. Fairbairn), the hon. Member for Renfrew West and Inverclyde (Mrs. McCurley) and others believe that the £50 million should be spent in the interests of Scottish ratepayers. Unless the Committee accepts the amendment, there will be no machinery to change the scheme, and real difficulties will occur.
I am not talking about natural rebels on the Conservative Benches. The fact that the hon. and learned Member for Perth and Kinross and, I suspect, the hon. Member for Banff and Buchan (Mr. McQuarrie) take a strongly independent line about getting the maximum help for the ratepayer from the sum allocated by the Treasury is significant. What is even more significant is that on Second Reading the hon. Member for Strathkelvin and Bearsden said:
I appreciate that eligibility should be set down in the Bill, but is the revaluation of three immutable? Could some other figure, which used up the money, be applied?" — [Official Report, 3 June 1985; Vol. 80, c. 80.]
 He also said that he stood by his threat, if I can call it that:, in the Evening Times that he will throw all his weight behind effords to ensure that the entire £50 million is applied to rating relief in Scotland.
It is significant when someone such as the hon. Member for Strathkelvin and Bearsden takes that line, not because I believe greatly in his political weight — I hasten to reassure the Committee on that—but because he is an identikit Tory. He is not one of the world's rebels; he is the loyalest of the loyal. He is the sort of young man that any hon. Member would like to chair his Young


Conservatives branch. When the hon. Gentleman comes to the House and says that the £50 million must be used in the way that was trumpeted at the Scottish party conference, and which brought peace to that conference, the Minister should listen to such persuasive arguments. If the hon. Gentleman was here to listen to the arguments —he has not yet appeared for the debate — I like to think that he would vote with us tonight, because it is a sensible amendment that does not commit the Government to a specific figure. It gives them some flexibility instead of leaving them in the lurch, when they would be in the most uncomfortable position of saying: "We have the money, but we shall give it back to the Treasury."
That would be wrong in equity and would be bad for the morale of Scottish ratepayers and for the political system. The Government should keep their clear promise that £50 million will be available. However, there is a grave danger that that promise will be breached unless the Bill contains some flexibility along the lines set out in amendment No. 3.

Mr. Donald Stewart: In speaking to amendment No. 4, which is in my name and that of my hon. Friend the Member for Dundee, East (Mr. Wilson), I shall draw attention to a small printing error on the amendment paper. The penultimate line uses the word "multiples" instead of "multipliers". I do not suppose that any of the intelligent members of the Committee were confused by that error, which probably arose from the haste with which the amendment was drafted on Monday night.
I should stress that it has become clear that, if only those whose revalued rateable values are greater than three times their pre-revaluation rateable values will benefit, it has been calculated that considerably less than the £50 million given by the Treasury will be used. The Scottish National party believes that all that money must come to Scotland for the purpose of rates relief. It is little enough compensation as it is, and the Government must not be allowed to get away with skimping on it.
I agree with the hon. Member for Glasgow, Garscadden (Mr. Dewar) that amendment No. 3 is flexible—indeed, any of the amendments in the group would meet my purpose—but amendment No. 4 states that if the full sum has not been used, the multiplier should be reduced to whatever figure is necessary to ensure the use of the full amount allocated by the Treasury.
The Chancellor of the Exchequer said that the plug will be pulled on this life support next year and that there will be no cash in successive years. It is essential that Scottish ratepayers, domestic and commercial, benefit to the full from the £50 million. Anything less will be regarded as a climbdown and a sell-out of the commitment given to Scottish ratepayers by the Secretary of State at the Perth conference. If he wants to save his political skin and that of other Conservative Members, he would be well advised to accept the amendment. If he does not, he will suffer a renewed backlash in Scotland.

Mr. McQuarrie: The Committee will welcome the presence this evening of the hon. Member for Gordon (Mr. Bruce) and his contribution to the debate, because he did not bother to appear for the Second Reading of the Bill or to contribute in any way on behalf of the ratepayers to

whom he pays lip service when he believes that he can make a political point. He said that no one had done any work to arrive at the factor of 3, but it is worth asking him how he arrived at the figure of 2·5. He said that he had no computer.
The hon. Gentleman tried to hide behind the cloak of the Scottish Federation of Small Businesses and Self Employed when he said that it would have to take its £5 million from the figure of £40 million. Yet he had the audacity to say to the Secretary of State on 14 May that the money was
 of the warped priorities of a Government threatened with extinction in Scotland."—[Official Report, 14 May 1985; Vol. 79, c. 178.]
It is strange that he described £40 million of relief as a warped priority when he asked for only £5 million. Would the alliance have allowed less?

Mr. Bruce: rose—

Mr. McQuarrie: I shall not give way because the hon. Gentleman has had his say. I should like to get rid of amendment No. 2.
The hon. Member for Gordon asked that the load should be spread fairly. I agree with that. In Grampian region, the rateable value before revaluation was £30·72 million for the private domestic ratepayer. After revaluation that figure rose to £86· 71 million. The figure was therefore increased 2· 82 times, or by 182 per cent. That is well above the 2· 5 factor called for by the hon. Member for Gordon. For the local authority domestic ratepayer the figure before revaluation was £13· 5 million. After revaluation it became £36· 45 million. In that case the figure was increased 2· 7 times or by 170 per cent. That is still not down to the factor of 2· 5.
The most important element of the £50 million relates to the commercial ratepayer. Before revaluation, the rateable value was £38· 51 million and after revaluation it rose to £86· 71 million—an increase of 2· 82 times or by 182 per cent. We still have not dropped to the denominator of 2· 5 which exists in the warped mind of the hon. Member for Gordon. Those are the average figures given by the local authority. There are plainly other increases between 2·7 and 3.
In Grampian region—the hon. Member for Gordon plainly does not know this — it is estimated that approximately 25,000 people and businesses will benefit from the Bill to a total of £2·8 million. Broken down, the figures mean that 21,128 domestic ratepayers and 4,416 commercial ratepayers will benefit.
I support the view that the whole of the £50 million should be used. I prefer amendment No. 4 to amendment No. 3 because I believe that amendment No. 4 covers the point more widely. The two amendments, however, are comparable because they want to achieve the same result —that the £50 million is used.
I hope that when my hon. Friend replies he will give a firm undertaking that the £50 million will be used. We are all aware that the Scottish Office and the local authorities did not know how much would be required to pay on a factor of 3. Computers have to do their work, and they have not yet been able to complete it. We may therefore find that there will be some £20 million in the kitty. I give my right hon. Friend the Secretary of State great credit for having obtained the money from the Treasury. I take no notice of the rubbish about its being to gain an electoral advantage. It was a first-class job done


by an honourable and first-class Secretary of State. [Interruption.] There will never be a Liberal Secretary of State, that is for sure.
Will my hon. Friend guarantee that that £50 million will be spent? To take the arbitrary figure that the hon. Member for Gordon and his two colleagues, the hon. Members for Roxburgh and Berwickshire (Mr. Kirkwood) and for Orkney and Shetland (Mr. Wallace) have suggested is not the best way to achieve that. Neither of those two colleagues of the hon. Member for Gordon are present; nor are any of the other Liberal Members. There is not even a member of the Social Democratic party present.

Mr. Bruce: Where is the Secretary of State?

Mr. McQuarrie: As I said before, he is in Scotland. He has not tabled an amendment. The hon. Members for Roxburgh and Berwickshire and for Orkney and Shetland have.
If there is to be £20 million in the kitty, the best thing to do is to reduce the factor from 3 to 2·9. If we still find that the £20 million has not been used, the factor can be reduced to 2·8. That is a fair and reasonable way to work. I am sure that the hon. Member for Glasgow, Garscadden (Mr. Dewar) will admit that, if we accept the figure of 2·5, there is no guarantee that the total will amount to £50 million. With that factor we might need more than £50 million. We must be grateful for having £50 million of new money, and we must take advantage of it. I hope that my hon. Friend will take note of that, because I do not agree that we should hand the balance of the money back to the Treasury.

Mr. Dewar: The hon. Gentleman is making a series of reasonable points which he would expect me to support. There is virtue in amendment No. 3, which provides machinery for achieving what we want. Amendment No. 4 merely provides that the Secretary of State would have the power to alter the factor. Amendment No. 3 provides that the figure can be altered by statutory instrument, as is provided in other parts of the Bill. We can then have a debate in the House and watch what is happening. If we do not receive assurances, I hope that the hon. Gentleman will join us in the Lobby on that point.

Mr. McQuarrie: I am grateful to the hon. Gentleman, because he has brought the point home to me. I must confess that I had slightly overlooked it. Amendment No. 4 had appeared to me to be more suitable. I accept that amendment No. 3 is probably more in the interests of the Committee, because we do not know the correct factor at the moment.
I regret that I cannot support my hon. Friend if he is not prepared to give an undertaking to the House that the £50 million will be allocated to Scotland in some form or other.

Mr. Bruce Millan: The logic of the speech of the hon. Member for Banff and Buchan (Mr. McQuarrie) is that he should vote for amendment No. 3. An assurance from the Minister will not mean anything unless a facility for doing something about it is written into the Bill. There is no flexibility with the way that the Bill is presently drafted. Amendment No. 3 has the advantage of giving flexibility. The factor could then be adjusted to whatever figure is considered appropriate to produce the sum of £50 million.
With the Bill as presently drafted, the relief granted will not amount to £50 million. We have figures from COSLA.

The hon. Gentleman gave us some figures from Grampian region. I have figures for other regions of Scotland. They total slightly less than £30 million. There is a little over £4 million on the domestic side and something over £25 million on the commercial side. We were promised that the domestic relief would amount to £10 million. The available figures show that the relief is less than half for domestic ratepayers. On the commercial side there is a considerable shortfall from the £40 million that we were originally promised. I do not think that there is any dispute about the figures. If there is, no doubt the Under-Secretary will let us know.
7.30 pm
The Government rushed into the legislation without doing any calculations. The announcement was made in the House on 14 May, the consultation meeting with COSLA was not held until 29 May and now that the figures based on the Government's proposals are coming forward, we see that there is a considerable shortfall.
Even now, the Government seem to be making no effort to get additional information. I tabled four questions for answer on Monday, with the idea of getting replies in time for the Second Reading debate on that day, so that hon. Members would have a sensible basis on which to conduct that debate.
I had considerable difficulty getting the answers on Monday at the normal time. I do not want to make too much of it, but the answers arrived considerably later than they should have done on Monday — literally a few minutes before the debate started. The answers were extremely illuminating. One said:
This information is not available.
It had taken the Government nearly a fortnight to tell me that they could not answer my question. The other answers were equally uninformative.
I asked the Secretary of State
if he will give the total number of domestic and commercial ratepayers, respectively, for each rating authority in Scotland and for Scotland as a whole and his estimate of the number and percentage …who are likely to benefit". 
The Secretary of State replied:
Complete information in the detail requested is not yet available.
I was not even told the number of ratepayers in Scotland. I also asked what the cost would be if the factor were 2·5 or 2·75. I am sure that with a factor of 2·5 the cost would be considerably more than £50 million. The Scottish Office and rating authorities have computers that have been used to make calculations, but the Secretary of State told me:
I do not have the information on which to base a reliable estimate, and to ask the rating authorities to do the calculations specially does not seem to me a worthwhile use of resources." —[Official Report, 3 June 1985;'Vol. 80. c. 81-2.]
 The administrative costs of the Bill will be £1 million, but the Government will not even ask local authorities to use their computers to calculate what would happen if different factors were applied. It is a ludicrous position.
The Government do not deserve to get their Bill in the time proposed, because they have not taken the trouble to do essential research to find out what the Bill will cost and what other methods would cost.
Applying a single factor of 3 to every rating authority in Scotland is bound to produce anomalies. Without being specific, the hon. Member for Banff and Buchan drew attention to the problem. The impact of the factor of 3 will vary from authority to authority, depending on the


revaluation increase for each category of ratepayer. The hon. Member for Banff and Buchan said that the percentage increase on the commercial side in Grampian was 182. The increase in Shetland was only 50 per cent., in Orkney it was 70 per cent, and in Lothian and Strathclyde it was 110 per cent. Different increases will lead to different results when the factor of 3 is applied to every local authority.
It would have been possible to have a more sophisticated system providing for different factors and allowing greater equity between ratepayers in various rating authorities. It would take account of the different results of revaluation, not, of course, of the different rate increases that are taking place in 1985–86 anyway. However, the Government rushed in with a crude calculation and did not take the trouble to do other calculations to find out whether a more sophisticated and fairer system could be devised.
Even within regions, there are considerable differences in the minimum rates increases above which ratepayers will qualify for relief. For example, domestic ratepayers in Eastwood will have to pay at least a 43·9 per cent, increase in 1985–86 before getting any relief. Commercial ratepayers in Eastwood will have to pay 62·9 per cent, more before getting relief under the Bill. That is an extraordinarily high threshold and that is only one example.
In Glasgow, relief will be given to domestic ratepayers only after they have paid a 39 per cent, rates increase, and commercial ratepayers will have to pay 52·9 per cent. more before relief is payable. There are a variety of figures in Strathclyde and other regions. I do not have the figures for districts in other regions, but no doubt COSLA and the individual regional authorities will have produced them.
All the information is available, but it has not been given to us. When I ask comparatively simple questions, I am told that the information is not available and that the Government will not even bother to find it. I suppose that they do not want us to know, because such information would enable us to raise intelligent questions in debates such as this.
Unless the Under-Secretary introduces some flexibility into the Bill, there will be a considerable volume of complaints from people who thought that they would get relief, but will have to pay massive rate increases and will get no help. They will also find that other ratepayers paying smaller increases will get help because of the way in which the Bill has been drafted.
There is no reason why, even at this late stage, we should not introduce some flexibility. It is impossible to do that in a thorough and sophisticated way, because none of us has enough information to allow us to draft amendments to change the Bill and be confident that we shall achieve a satisfactory result. However, amendment No. 3 would at least write in the minimum amount of flexibility.
The £50 million was trumpeted as a great victory for the Secretary of State. If the Government were serious about helping ratepayers, we could adjust the factor and ensure that all the £50 million was used. That is all that we are arguing for in the amendments.
I understand why the 2·5 factor has been suggested, but, depending on the revaluation in some areas, that could

be extravagantly expensive. However, we are entitled to have answers and it seems that we are not to be given the figures.

Mr. McQuarrie: It is nonsensical.

Mr. Millan: It is never nonsensical to ask for information. Amendments Nos. 3 and 4 are sensible, but I prefer the drafting of No. 3. I hope that the Minister will either accept one of them or give us the necessary assurances. If he does not, I hope that Conservative Members will support us in the Division. Otherwise, there will be a breach of faith over the original announcement, because it is clear that the £50 million will not be reached. In view of all the trouble and argument about revaluation in recent months it would be intolerable if concessions were apparently made and then not used to the full.

Mr. Bill Walker: The right hon. Member for Glasgow, Govan (Mr. Millan) clearly showed that if one attempts to provide rough justice by using just one figure, there are bound to be areas of injustice.
I believe that I am the first hon. Member to declare a personal interest in the Bill. The cash increase for my domestic dwelling in Blairgowrie is a horrendous 64 per cent., so I shall benefit from the Government's proposals and I welcome that benefit. When I made my plea for action by the Government I proposed that no one should have to pay more than 50 per cent, above the previous year's cash value, and I made that special plea largely for the commercial ratepayers of Angus. With a multiplier of 3, the increase in cash value will be about 52 per cent, for those people, so the Government have come very close to meeting my request in that context and I am grateful for that.
In making that request, I added the qualification that this should apply until those people's appeals had been heard and had been successful, because on the figures given to me by the Government, I judged that many of the shopkeepers and others substantially affected by the revaluation would succeed in their appeals. I based that judgment not just on the previous rateable values but on the rents actually paid by those shopkeepers who paid rent for premises on main streets in Angus. As valuation is supposed to be based on the rent that could be obtained, it seemed clear from those figures that many of the appeals would succeed.
Amendment No. 2 is about as wise and sensible as the nonsensical comments and figures bandied about by alliance Members before the Government's proposals were made, When asked by members of the Press Gallery how much money I believed would be required, I suggested that it would be between £90 million and £120 million if my survey in Angus was representative of the whole of Scotland. I could not say whether it was representative because I could not carry out a survey of the whole of Scotland. In my view, amendment No. 2 is the usual exercise in kite-flying designed to obtain publicity rather than to solve difficult and complex problems.
Ratepayers in Scotland are facing savage increases. We may differ politically about the reasons for those increases, but we must agree that the increases are so savage that they cannot be allowed to remain. The Government have accepted that and have moved very quickly, but I shall be interested to hear their response to amendment No. 3, which seems to provide the kind of flexibility that could not be achieved within the time scale in which the


Government brought their proposals forward. I make no criticism of the remarkable speed with which the Government acted—indeed, I am eternally grateful for it because the situation in Angus was even more appalling than that in Perth and Kinross.
7.45 pm
I appreciate the reasoning behind amendment No. 4 and I do not argue with it because I believe that it is probably right in principle, but the wording is not all that it should be and I believe that amendment No. 3 achieves the same objectives. I hope that my hon. Friend the Under-Secretary of State will tell us why the Government cannot accept the flexibility proposed in amendment No. 3. Ratepayers in my area would certainly like to believe that the speech made by my right hon. Friend the Secretary of State in Perth means that ratepayers will receive the full value of the £50 million. I am not especially concerned about how that result is achieved but if that sum is available we need to assure ratepayers in Scotland that it will be used in full to mitigate the difficult circumstances in which they find themselves. I believe that many of my constituents will succeed in their appeals against the increases. If that is the case and they do not require the assistance generously proposed by the Government, I shall be delighted.

Mr. Foulkes: I do not know whether the hon. Member for Tayside, North (Mr. Walker) was present earlier in the debate to hear his hon. Friend the Member for Banff and Buchan (Mr. McQuarrie) laying into the hon. Member for Gordon (Mr. Bruce) with vilification and personal abuse. We in the new, emerging Labour party do not intend to become involved in such dogfights between the old Whig and Tory parties. We intend to concentrate on the merits of the argument and to put a few questions to the Minister.
No explanation has been given publicly or to the House as to how the factor of 3 was arrived at. According to The Scotsman, the Under-Secretary of State for Scotland said:
when the scheme was drawn up a decision had been made on the level of revaluation increase that would create an unacceptable burden
and:
We decided that level was three times the existing rateable values".
On what basis was that decided? Why should there be such integer worship in this age of computers? If a factor of, say, 2·9 were more appropriate, the calculation could be made just as easily. The Minister has a duty to explain why he decided on a multiplier of 3. [Interruption.] I see that the other half of the alliance has arrived, in the shape of the hon. Member for Ross, Cromarty and Skye (Mr. Kennedy)—better late than never, I suppose.
The Prime Minister has promised at least £50 million. What will happen if COSLA is right and only £30 million is spent under the Bill? Will the remainder go back to the Treasury? Will it go into other areas of over-expenditure such as the bottomless pit of fortress Falklands? We need to know. That is why, among many other reasons, I support amendment No. 3 proposed by my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar), because it provides the flexibility needed to make adjustments in the light of experience when we see the proposals in operation.
The Minister said that the purpose of the exercise was to assist hard-pressed ratepayers, not to undo the changes that had taken place as a result of revaluation. That makes sense. Presumably the purpose of revaluation was to move

the burden from certain ratepayers in the commercial sector to others. If so, who in the commercial sector is gaining? The Under-Secretary referred to a hotel in Dumfries and Galloway. Apart from that one example, who are the gainers?
It has been said that a 14 per cent, additional burden is falling on the commercial sector as a whole and that the vast majority of people in that sector are suffering. On the other hand, when we discuss reducing the figure—for example, under the Liberal amendment to 2·5, the Minister says that over half the domestic ratepayers would get relief if there were a 2·5 multiplier. Does that not show that the revaluation has resulted in over half of domestic ratepayers having an increase of more than 2·5 times?

Mr. Ancram: That is what "average" means.

Mr. Foulkes: Of course, but why 2·5? I would not have expected that to be the average. A retired school teacher, now masquerading as an Under-Secretary, may correct me, but may we be told why, at 2·5, half should be above and half below?
Why are there so many regional variations? There seems to be a total difference between Strathclyde on the one hand and, say, Tayside, Lothian and Grampian on the other. There seems to have been no co-ordination or collaboration between the assessors. Nor can I understand how the assessors made their comparisons. I understood that the exercise was supposed to be based on rentals that might be achieved for the premises. One gathers, however, that a whole range of matters come into the calculation, including — dare I mention it?—private houses in Ayr such as the one in which I live, the posh type of house that the Minister described earlier. But there are no houses such as that being rented in the area with which we are concerned. In other words, I do not understand how the bases of comparison were worked out.
It has been said that, because revaluation has taken place north, rather than south, of the border, shops which are branches of United Kingdom multiples can obsorb the increases much better than Scottish-based firms, so that the former can rejoice in the fact that in most of their shops south of the border they do not have the same burden. That is not the case for the Co-ops in Scotland or for all other Scottish-based companies.
I hope that the Minister will take the Labour amendment seriously. Power would remain in the hands of the Minister and at the end of the day, in the light of experience, the Secretary of State would be free to decide what, if any, action to take. If, as COSLA has predicted, £20 million will not be taken up, the amendment will be necessary, and the hon. Member for Eastwood (Mr. Stewart), if no one else, should support it.

Mr. Ancram: We have had another interesting debate on this important topic. The remarks of the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes) underlined some of the confusions that have arisen in the public mind as a result of the revaluation. Indeed, they underlined also the reason why we are keen to look again at the system of financing local government so as to find a better way of doing that. We are delighted to note that at least he among Opposition Members is with us on that, and we look forward to hearing further from the occupants of the Opposition Front Bench about their views on the subject.
There has been some misunderstanding over this issue recently as was clear from the Second Reading debate on Monday. The scheme arose initially from an appreciation by the Government — and by the hon. Member for Glasgow, Garscadden (Mr. Dewar), as he made clear at Scottish Question Time recently — that ratepayers had been hard hit by revaluation.
I do not want to rub it in, but the hon. Member for Garscadden has in the past welcomed revaluation. He appreciates, however, that a number of ratepayers have been severely affected at the margins of revaluation. He offered the Government co-operation in introducing a mechanism to help the hardest hit. If he did not use those exact words, he used words to that effect. The scheme sets out to do that. It aims—this is what the Bill puts into practice—to remove the worst cases due to the sudden revaluation changes that have occurred.
The threshold multiplier of 3, which the Government have selected, is not designed—and it would have been wrong had it been designed—to nullify or neutralise the effects of revaluation. It is designed to deal with the harsh and difficult cases on the margins but not, as it were, to re-write the revaluation. Indeed, we should not do that, because if we were merely to re-write it in favour of those who were losers as a result of revaluation, without doing anything for the gainers, we should create a very strange and distorted pattern indeed. We all accept that there are good reasons for changes in valuations, and if those reasons do not apply in the cases of any valuations, the assessors must defend those valuations in the court.
Thus, we looked at the range between 2·33, which is the average revaluation multiplier for all property in Scotland—that is the level in general or average terms, so that if one is below that level one gains from revaluation and if one is above it, one loses—and ranges beyond that, through 3 to 4, as suggested by the Federation of Small Businesses and the Self-Employed, and at some of the other ranges of revaluation affecting properties in Scotland.
The difference between 2·33 and the 3 times multiplier leaves a range which allows revaluation still to be effective in the terms that it is supposed to be effective, yet at the same time allows us to protect the hardest hit. Above a multiplier of 3—given that there are variations; the right hon. Member for Glasgow, Govan (Mr. Millan) was right to point to regional variations — the results of the revaluation in terms of the rate effect would have been unacceptable.
For that reason, we chose a multiplier of 3, and on to that we have built a scheme which is simple and straightforward and, most important, which enables people to understand whether they do or do not qualify. We hope that, as a result, we are meeting the target that we sought to cover in the first place.

Mr. Dewar: I wish to be clear about the implications of the Minister's remarks. Is he saying that the Government are satisfied that in working the scheme based on a uniform multiplier of 3, they have done enough? Should the scheme cost only £25 million, leaving the other £25 million unallocated, would the Government then not want to use that other £25 million? In other words, is not the impression that £50 million was being found to help

Scottish ratepayers a mistaken impression? Are the Government saying that the scheme is complete and that, no matter how big the shortfall, they will not make it up?

Mr. Ancram: I shall be dealing with that. If we reduced the multiplier trigger in the scheme down towards the average multiplier, we should in effect be removing the effects of revaluation. If the hon. Gentleman believes that revaluations should take place—he pressed us to carry out this revaluation—he will accept that we must set a trigger point which will leave an effective revaluation while at the same time protecting the hardest hit. The scheme is demand led. Once the eligible category has been denned, the amount that the scheme will cost will depend upon how many people fit into that category. There will not be an allocation of fixed money.
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On a decision to focus on a level of valuation above which rebate is to be given reflects the judgment that approximately three times this year's revaluation is about the right level at which to intervene and reduce the effects of revaluation. The amount of money that it will cost has been the subject of a number of conjectures, both high and low, during the last two months. As I said during the Second Reading debate on Monday, I do not believe that we shall know the total amount of money that will be expended on the scheme until the last eligible ratepayer has been paid.

Mr. Millan: Will the Under-Secretary of State give way?

Mr. Ancram: I shall give way to the right hon. Gentleman in a minute.
At that time we shall know precisely what the outturn figure is. As the analyses of the revaluation take place those figures will become more accurate, but I do not believe that we shall know the exact figures until the last ratepayer has been paid.

Mr. Millan: I do not suppose that we shall know the exact figure down to the nearest pound, but we know that it will not be £50 million. It will be nearer £30 million, and perhaps even less than that.

Mr. Ancram: The right hon. Gentleman presided over the last revaluation and we saw its effect upon commercial ratepayers. At that stage the right hon. Gentleman never suggested that any scheme of relief should be provided. He is now complaining about what, on any view, is a very generous scheme in terms of both money and eligibility. The people of Scotland have looked carefully at the Government's proposals. They accept that both the financial commitment and the scheme underline the concern felt by the Government for those who have been hardest hit by revaluation.

Mr. Millan: The Under-Secretary of State is surely not disputing the COSLA figures, which amount to less than £30 million. We know that there will be a shortfall of £20 million.

Mr. Ancram: As I said on Monday, my understanding is that those figures are not yet complete. We cannot begin to give figures until we know which ratepayers are eligible under the scheme.

Mr. Gordon Brown: Can the Under-Secretary of State explain why he chose the figure of 3 instead of 2·9 or 2·8? Can he also explain why the


figure of £50 million was announced? Were the Scottish Office figures based only upon a random look at the Strathclyde valuation roll? Was there no consideration of the situation facing Fife, Central, Lothian, the Highlands, the Grampians and the Borders?

Mr. Ancram: The hon. Gentleman has not attended the greater part of our debate today. His question has already been answered. I have already made it clear that, if one reduces too far towards the average multiplier, one effectively writes off revaluation. An element of judgment is involved. The difference is between an average multiplier of 2·3 and a multiplier of 3. Within that area we believe that revaluation will have its full effect. The increase that will be paid by those who are above the multiplying factor of 3 will be rebated to them under the scheme. The people of Scotland appreciate, by and large, that it is those who are over the multiplier of 3 who are the hardest hit. Multipliers of 4, 5 and even 6 have been given to me. Those people are very hard hit and they appreciate what the Government are doing for them. The Opposition are doing themselves no good by cavilling over figures when we are talking about sums of money which are so much bigger than anything that they suggested when they said that there ought to be a scheme of this kind.

Mr. Maxton: Will the Under-Secretary of State give way?

Mr. Ancram: No, I have already given way to many hon. Members during both this debate and the last debate.
The Government's proposals are reasonable and simple. That is important if the scheme is to operate effectively and quickly. The amendments would take rebates beyond the level that we think is reasonable and would complicate the operation of the scheme. The amendment moved by the hon. Member for Garscadden would create vast areas of uncertainty. One of the benefits of the Bill is that those who are eligible will know that they are eligible. That eligibility will continue. According to the amendment moved by the hon. Member for Garscadden, the multiplier could, on occasion, be increased as well as reduced from year to year. Those who are eligible would not know whether they would continue to be eligible under any future scheme. That is not the right way to proceed.

Mr. Dewar: The Minister has said something which I believe is quite important. Is he saying that, as it is drawn, the scheme can be continued if he exercises his discretion next October and that it would have to be continued in the same way and at exactly the same level?

Mr. Ancram: It would not necessarily be continued in the same way, because the manner of the scheme is contained within the order. Those who are eligible are defined in the Bill in terms of both their category and of the multiplier that is required to trigger their eligibility. The simplicity of the Bill, which is important to its implementation, is helped by dealing with it in this way. Therefore, I ask the Committee to reject the amendments and to support the Government.

Mr. Craigen: Having heard what the Under-Secretary of State has had to say, I am now more than ever convinced of the virtue of amendment No. 3. Irrespective of whether it is the Liberal party's 2·5, or the Scottish National party's £50 million, or our amendment No. 3, which proposes a variable but with a full take-up of the £50 million, we want

the package that was announced in Perth to be spent for the benefit of Scottish ratepayers. It is clear that the revaluation relief package that was announced was both a platform confidence trick by the Secretary of State for Scotland and an exercise in back-stage bungling. The more time that has elapsed the more evident it has become that the Scottish Office computer is not working. As my right hon. Friend the Member for Glasgow, Govan (Mr Millan) pointed out, all the rating authority computers are busily churning out the kind of information that was quoted earlier by my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar).
I hope that the hon. Member for Gordon (Mr. Bruce) will withdraw his amendment. It was not scientificallycal-culated. He admitted as much earlier. I do not blame him for that. The Government are even more guilty. They have been unable to provide precise figures. I hope that the right hon. Member for Western Isles (Mr. Stewart) will also withdraw his amendment, because we are at one with him. We want the £50 million to be spent in Scotland. Amendment No. 3 provides the mechanism which would make it possible to achieve the lower factor.
Several hon. Members have asked the Under-Secretary of State how the magic figure of 3 emerged. I know that the hon. Member for Stirling (Mr. Forsyth) thinks in threes. Several hon. Members served on a Standing Committee in which he always spoke of three, or 30 or 300. I wonder, therefore, whether the Stirling factor had something to do with this. When the Secretary of State made his statement to the House on 14 May I asked him how many people would come within the 2·7 and the 3 factor on the domestic side and the 2·2 and the 3 factor on the commercial side. He did not tell. It is now quite obvious that he did not know. Furthermore, he could not even give the number of people on the commercial and domestic side who would benefit from the factor of 3.
On 16 May I wrote to the Secretary of State about the Government's revaluation relief scheme. I was trying to be as practical and constructive as possible, and I wrote:
If, by the end of June, the take-up by domestic and commercial ratepayers is nowhere near the £50 million allocated, will you consider reducing the threshold from three tunes the rateable value to 2-·7 times in respect of domestic ratepayers and 2·2 times in respect of the commercial sector? As I understand your aim, it is to neutralise the effect of the 1985 revaluation increases and you did indicate that 2·7 and 2·2 respectively represented neutral average increases arising from the revaluation.
On 23 May, the Minister replied, and in his long letter, which did not tell me much, he said:
we now think there might be up to a quarter of a million properties which could stand to benefit, including both domestic and non-domestic.
When the Secretary of State for Scotland announced this scheme in all the paraphernalia after the Perth conference on 14 May, we were led to believe that about 300,000 would benefit from the scheme: 250,000 domestic ratepayers and 50,000 businesses. But the more time goes by, the more the beneficiaries seem to disappear. The Minister still cannot tell us how many beneficiaries there are under the scheme. Indeed, it is quite evident that when the statement was broadcast at Perth, the Secretary of State just did not know. It was all political camouflage
The delegates at Perth had to be told something. The Secretary of State had to assure them that the Scottish Tory Members at Westminster were not an extinct breed. Consequently, he came up with the £50 million figure. To


compound everything, the Chancellor of the Exchequer was then telling the Scottish press that the Secretary of State would not get his £50 million next year. [Interruption.] As has been pointed out, we shall not even get the money this year. Indeed, the figures from the local authorities and the business sector show that the figure is more likely to be about £30 million.
The Government have put a lot of effort into their revaluation rebate scheme, but it must be seen against the background of Monday's social security review. The same Government who have kidded all their Back Benchers about there being a reform of the rating process propose to get 750,000 Scots on housing benefit to pay rates. The Government say that in order to ensure that those people know what rating is all about, they will have to pay at least 20 per cent, of their rates. On the one hand the Treasury says that it will give £50 million this year to help over the revaluation, but on the other hand the DHSS says that it will begin to bring 750,000 people into the rating network. In the euphemistic terms of the Civil Service, I believe that that is called departmental log-rolling. I refer to the idea that if one Department gives, another has to take away. At the end of the day there are sufferers from all those administrative changes.
I hope that the hon. Member for Gordon and the right hon. Member for Western Isles will ultimately agree to support amendment No. 3. More importantly, I hope that all those Tory Back Benchers who make speeches to ratepayers want to see that £50 million spent, and will be in the Lobby with us. I hope that they will not sit on the fence and abstain, but will support amendment No. 3.

Mr. Bruce: Having been at the receiving end of an unprovoked and unexpected attack from my neighbour, the hon. Member for Banff and Buchan (Mr. McQuarrie), I was interested to note that the Minister did not say why 2·5 was unacceptable, or what it would cost. Presumably, he was unable to do so. I accept that it would bring many more people into benefit, which was the point of lowering the threshold. Indeed, that was the point of the amendment. If the Minister was anxious to suggest that the figure is unacceptable, I should have thought that he would have some arguments to support him. However, he was unable to produce them. He could not say whether the £50 million would be underspent and if so, by how much, and by how much my proposal would put the figure over £50 million.
The hon. Member for Banff and Buchan seems to think that the Government's proposals will be greeted with rapture by ratepayers. If he goes to areas in my constituency, including parts that he used to represent, he will find the reception less than enthusiastic. If Banff and Buchan is compared with Gordon, hon. Members may understand why the hon. Gentleman can afford to be slightly more complacent. The average increase in domestic valuations in Banff and Buchan is 260 per cent, compared with 280 per cent, in Gordon and 290 per cent, in the city of Aberdeen. In cash terms, the average increase in the domestic rate element for Banff and Buchan is 6·7 per cent., but in Gordon it is 15 per cent, and in Aberdeen 1·1 per cent. When the commercial factor is considered, the figures are even more interesting. The increase is 230 per cent, in Banff and Buchan, 260 per cent, in Gordon

and 280 per cent, in Aberdeen. In cash terms, that is 9·1 per cent, in Banff and Buchan, 27·5 per cent, in Gordon and 27·1 per cent, in Aberdeen. I am sure that the hon. Gentleman must recognise that people facing such rate increases are looking for much more relief than the Government are offering.
It is a cause for concern that the Government have now implied that if the Bill is enacted unamended there will be no opportunity to adjust, in the way that the hon. Member for Banff and Buchan implied would be acceptable, if the full allocation is not taken up. Clearly, the best way of allocating any extra cash is to lower the threshold to ensure that more people benefit. But that possibility will not be open to the Government if they do not accept any of the amendments.
In the interest of ensuring that we unite behind one amendment that gives the flexibility that the Bill needs, and that the Government will need, I am willing to withdraw my amendment and to urge my colleagues to vote for amendment No. 3. However, if the Government resist it, they will find that the outrage of this year will be as nothing compared with next year, because the people will realise that they have been conned and bought off for a year. Those Conservative Members who have said that they are keen to ensure that there is a full take-up should vote with us and demonstrate that they are not prepared just to use weasel words for the benefit of their constituents but are also prepared to stand up and fight. Accordingly, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment proposed: No. 3 in page 1, line 13, after 'value', insert
'or such other figure as shall be set by statutory instrument which shall not have effect until approved by resolution of the Commons House of Parliament'.—[Mr. Dewar.]

Question put, That the amendment be made:—

The Committee divided: Ayes 108, Noes 181.

Question accordingly negatived.

Mr. Paddy Ashdown: On a point of order, Mr. Walker. I apologise for interrupting the flow of this important debate, but I have a matter that needs to be drawn to the attention of the House and which touches on the safety of those who work in the House and of those who visit us. The facts are as follows. Midway through yesterday afternoon, the secretary of a colleague of mine was taken seriously ill in Norman Shaw South and immediately moved to Westminster hospital where she was put into the intensive care unit. I understand that word filtered back that part of the reason for her condition was, to use the word received, the "poisoning" of the water supply system at Norman Shaw South. Early this morning, before staff had arrived, an announcement was made on the public Tannoy system in Norman Shaw South saying that the water supply should not be used for drinking, but no further steps were taken and none of the staff who arrived later than 9 o'clock was so informed, although in due course notices were put on the taps.
About midday, my secretary, who was involved in the incident yesterday, informed me that there was considerable concern among hon. Member' secretaries in Norman Shaw South; they were unclear about what had happened and of the danger in which they stood. I asked the Serjeant at Arms to provide information as to what had happened and to assure me that appropiate steps had been taken to ensure that our staff were being adequately informed so that they could protect their health.
I was informed that investigations into the water supply were going on, but that they would not achieve any results


until later. Meanwhile, I received assurances that staff would be informed. The Chief Whip of my party, my hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith), received similar assurances that it was not known what had gone wrong with the water supply but that investigations were underway.
It has now come to my notice that the press has been told that what happened was that at 11·30 yesterday morning, some 22 gallons of anti-corrosion liquid, intended for the central heating system in Norman Shaw South, were poured into the water supply system by accident, and that that liquid contained certain unpleasant chemicals. I am also told that the press was informed, although hon. Members—in particular my hon. Friend for Berwick-upon-Tweed and I — were not, that these facts were known at 8.50 last night. The facts will be published tomorrow morning.
It is important that we should know why this has happened, why such hopelessly inadequate steps were taken to inform our staff this morning, why the situation was not explained to us, and why were we not told the facts. Further than that, why were we positively misled? Some of our staff and some who visit the House may have been endangered by the appalling accident that occurred yesterday, but some of them may also have been endangered by the fact that such inadequate steps have been taken. I have no doubt that if the facts that I now have are true and if we were formal employers, we would be liable to action under the Health and Safety at Work Etc. Act.
We must now have a clear statement on the current position and clear instructions that will provide for the safety of our staff and others who visit the House. We need assurances that there will be a full investigation of the matter. I hope that you, Mr. Walker, agree that it will be appropriate for the responsible Minister to come to the House to give some assurances.

The Chairman of Ways and Means (Mr. Harold Walker): There is one difficulty—we are in Committee at the moment and, strictly speaking, we should not be discussing such a matter. However, in view of the seriousness of what the hon. Gentleman has told the Committee, I felt that it was proper to allow the hon. Gentleman to go on. I see that the Leader of the House is present and wishes to speak.

The Lord Privy Seal and Leader of the House of Commons (Mr. John Biffen): I should like to respond to the points that have been raised, which I realise have caused great anxiety. I am sure that hon. Members in all parties will be anxious for Mrs. Jacqueline Winter, hope that she will make a speedy recovery, and feel concern about the incident. The hon. Member for Yeovil (Mr. Ashdown) has made a number of accusations and raised a number of points that are clearly of substance. I shall arrange for a statement to be made at the earliest possible moment.

The Chairman: I think that it will be sensible for us to leave the matter at that now and return to the debate.
Clause 1 ordered to stand part of the Bill.

Clause 2

FINANCE

Question proposed, That the clause stand part of the Bill.

Mr. Craigen: I should like the Minister to tell us something about the working of the clause. It relates to the reimbursement to rating authorities of the payments that they make under the scheme. We tabled an amendment about administrative costs, but it has not been selected. However, perhaps the Minister will reply to some of the points that I and other hon. Members made on Second Reading, but to which he did not have the time or opportunity to reply in detail.
For example, I note that the Secretary of State will be determining the conditions as to records, certificates, audits and other things over which the payments will be made. Will the audit be at the end of the financial year? Will local authorities be involved in outlays earlier in the current financial year, for which they will not be reimbursed until the end of the financial year?
On Second Reading, we raised a number of points about interest charges to local authorities. Clearly, although the Government are proposing to reimburse local authorities for the payments that they make under the scheme, the payments themselves may involve local authorities in extra costs. I think that the Secretary of State referred to the payments not involving local authorities in any breach of guidelines. However, in his winding-up speech on Second Reading, the Minister did not answer my question as to whether the costs that rating authorities would incur in administering this scheme would bring them into difficulty in complying with the Government's guidelines over rate support grant and expenditure.
Will the Minister take the opportunity today to answer a point that has been left in the air? Nobody knows precisely what the position will be. Therefore, I should be grateful if the Minister will dispel some of the lingering doubts and anxieties.

Mr. Ancram: I am always keen to dispel the doubts, lingering or otherwise, of the hon. Member for Glasgow, Maryhill (Mr. Craigen). The hon. Gentleman will find that on Monday I answered one of his specific questions about the difficulties that might be faced by local authorities which might have to wait for reimbursement. I said that we would consider whether there was some way in which we might help them by making advance reimbursement before final certification was completed.
In regard to administrative costs, I listened carefully on Monday to my hon. Friend the Member for Stirling (Mr. Forsyth) and to other hon. Members. Having given the matter consideration, my right hon. Friend proposes, in exercising powers already available to him, to disregard for guideline purposes certain local authority expenditure on the administration of the rebate scheme in 1985–86. My Department will be discussing with the Convention of Scottish Local Authorities the exact terms of the disregard.
The hon. Member for Maryhill was rightly concerned that in some circumstances authorities might find themselves penalised for the cost of the administration of the scheme. I hope that I have clarified that point to the satisfaction of the hon. Gentleman. In view of what my hon. Friend the Member for Stirling said on Monday, I hope that he will feel that we have responded to the valid points that were made.

Mr. Craigen: I am grateful to the Minister for reassuring me about the disregard in respect of payments incurred. This is not really the time to raise the matter, but I still think the Government are being unfair in burdening rating authorities with the cost of administering the scheme. Although the Bill refers to £1 million, that is only an estimate. In view of the earlier discussion about the take-up of £50 million, I wonder whether the calculation will be any more realistic.

Mr. Ancram: If the hon. Member is right in his first estimate, compared to the estimate that we made, he will find that the cost of administration will go down commensurately.

Mr. Craigen: I wonder. I was about to say to the Minister that in view of the fact that there will be reclaims of rebates already made, where a person has succeeded in his valuation appeal it seems that the rating authority will be involved in a second set of expenditure. The Government have rightly left it to the rating authorities to identify those ratepayers who will be eligible under the scheme. As rating authorities are being given this direct responsibility, it would make more sense for the Government to acknowledge that they should have direct responsibility for the administration of the scheme.
Question put and agreed to.
Clause 2 ordered to stand part of the Bill.

Clause 3

CITATION, COMMENCEMENT AND EXTENT

Mr. Dewar: I beg to move amendment No. 7, in page 2, line 38, leave out 'which'.

The Chairman: With this amendment it will be convenient to discuss amendment No. 9, in page 2, line 39, leave out from '1985' to the end of line 40.

Mr. Dewar: We are now galloping towards the close. There has been a slightly ungracious welcome for the amount of co-operation that we have given to the Bill. We are allowing it through in a remarkably expeditious fashion. As an instance of that, in the normal Committee stage I could have been happily entertained for many hours discussing the amendments now under consideration. I say that unashamedly. I shall now dispose of them in about 90 seconds, to my considerable regret. It is an exercise in self-discipline that surprises me.
This matter arose on Second Reading. The Committee will remember that clause 3 says:
"This Act … shall come into force on the expiry of 2 months beginning with the day on which it is passed."
I want an assurance about whether that means that the Bill does not come into force until two months after it has completed its passage through the House of Lords. While I accept that their Lordships will not delay the Bill, that means that the two months will start in some weeks' time.
8.45 pm
The order is an essential part of the apparatus without which we cannot have positive action to disburse money. If it cannot be laid until the Act is in force, I suspect that, because of the parliamentary timetable, we could not have it until the autumn. That will delay the whole business of calculation and disbursement so far into the financial year as to raise substantial difficulties for local authorities and for the Scottish Office.
Can we have an assurance from the Minister that if he insists on keeping the time lag of two months in the Bill it will be possible to lay and debate the statutory instrument within that two-month period without having to wait until the Bill comes into force? If the answer is yes, it will remove my fear to some extent.
The Minister might take a minute to explain the matter, I am not sure why we need the provision that the Bill shall not come into force until two months after it completes its passage through Parliament. There does not seem to be any rationale in that. Obviously there must be, and perhaps the Minister will explain it.
The real problem is that it seems illogical if the statutory instrument depends upon the Bill. If the Bill does not come into force for two months, can we start the statutory instrument on its way before the expiry of that two months? If we cannot, there will be considerable problems. I am sure the Minister has followed the point and I shall be grateful for his answer.

Mr. Ancram: As I said in reply to the Second Reading debate, the Bill is in accordance with normal practice in coming into force after two months. Much requires to be done before effect can be given to the Bill. We have to give local authorities and ratepayers a period of two months to make the necessary arrangements. The order setting out the details of the scheme must be brought before the House after the Bill has been enacted. To answer the point the hon. Member was making, this can be done after Royal Assent has been given to the Bill and does not have to wait until the Bill comes into operation in two months’ time.
We are working towards a period of two months during which certain administrative arrangements will have to be made. The order will have to be laid and approved by both Houses of Parliament. Thereafter, at the end of two months the scheme will be capable of being operated. We wish to see the scheme in operation if possible before we get to the stage when rate bills have to be paid in September. The timetable in the Bill will allow that to happen.
If the amendments were to be accepted they would not in practice make any difference to the timetable because the work will have to be done in any event. The timetable does not delay the operation of the Bill in the sense of making sure that it achieves what it set out to achieve within the time scale that both the hon. Gentleman and I want. On that basis, I hope the hon. Gentleman will be prepared to withdraw the amendment.

Mr. Dewar: I will be prepared to withdraw the amendment on that assurance. Like the Minister, I am anxious to see the machinery in operation as quickly as possible. Many people will already be paying their rates on the 10-month instalment basis. The first instalment will have been paid in May so adjustments will have to be made, presumably in the subsequent instalments towards the end of the financial year. A new book will be issued showing a lower rate of contribution for those who are getting something out of the rebate scheme.
If the Minister is satisfied that he does not need to delay the statutory instrument and that the period of two months is really of no importance, I am prepared to take that assurance. Therefore, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 3 ordered to stand part of the Bill.

New Clause 2

LIMITATION OF RELIEF

'The total rebate payable will be restricted to a maximum of 10 premises and a total maximum of £50,000 for any one corporate body.'—[Mr. Bruce.]
Brought up, and read the First time.

Mr. Bruce: I beg to move, That the clause be read a Second time.
The new clause is an attempt to provide a further targeting element in the Bill. I was taken aback by a phone call two or three weeks ago from a shopkeeper who thinks that the Bill does not prevent large companies with chain stores from receiving substantial benefit. I believe that the measure should concentrate on small businesses and small shop units. I do not want to repeat my argument about the threshold being too low, but the Bill should not enable large amounts to be refunded to relatively large companies.
It is difficult to be specific, but some companies have many branches consisting of small shops such as newsagents and supermarkets which might be able to claim rebate on each of their premises. That could mean that tens of thousands of pounds could go to one enterprise. That would be regrettable if the money was then not available to assist small businesses with only one or two outlets. The measure is designed to try to save businesses which might cease to trade as a direct result of rate increases.
The shopkeeper told me that she operated two shops —one in Aberdeen and the other in York. The shop in York, which is six times larger than the shop in Aberdeen, pays rates of £850 and the much smaller Aberdeen shop, under the new revaluation, will pay rates totalling £1,400. The Bill will give that shopkeeper rate relief, but she will still have to pay substantially more for her shop in Aberdeen than for her larger shop in York.
I appreciate that the Bill is confined to Scotland and that therefore the comparison is not valid, but the point will not be lost on the Minister. Many of the larger groups which trade throughout the United Kingdom might be able to claim substantial rebates.
As the hon. and learned Member for Perth and Kinross (Mr. Fairbairn) said, a major store moving into a town centre is an asset and we must consider that. However, that is a wider problem and might be resolved by the abolition of the rating system. Businesses should not have to pay more rates in Scotland than they pay in England and Wales. That possibility is causing concern and might affect future investment and development in Scotland.
The new clause ensures that no chain store operator receives a substantial rebate. The money saved could be redirected to ensure that the benefit goes to those who need it most. If nothing else, it could be used by the Government to assist small businesses in other ways by reducing the costs of their overheads.
Most hon. Members will have received representations from the National Federation of Small Businesses and Self-Employed which is looking for a £10,000 limit. That is probably too narrow a boundary. It restricts assistance to a maximum of 10 premises and a maximum figure of £50,000. That would ensure that all medium-sized businesses would receive full benefit but that the large businesses which are best able to carry the burden would

be restricted to a £50,000 rebate. The Minister says that he does not want to neutralise the effect of revaluation, but that is a different argument.

Mr. McQuarrie: I oppose the new clause because the hon. Member for Gordon (Mr. Bruce) is wrong again. He spoke about chains, but he has forgotten that the chains operate individual shops in different towns. An example is C and J Clark, the retail shoe operator, which has over 100 retail shoe outlets throughout Scotland in the names of Peter Lord, Ravel and K shoes. They are individual businesses employing managers and staff. If they cannot enjoy the benefits that can arise from revaluation they will be penalised. The firm estimates that the increased rate burden for all its Scottish shops will amount to an additional £300,000 this year. It estimates that £75,000 will be returned as a result of my right hon. Friend's scheme announced on 14 May. Without that the firm will have to pay an additional rate poundage throughout Scotland of £225,000 this year. That would be unfair because we are talking about small businesses.
I totally support small businesses. There are two such shoe shops in Aberdeen and three in my consituency and I am sure that there are more in the hon. Gentleman's constituency. If they are forced out of business it will be because they have not enjoyed the advantages of the Government's scheme. I urge hon. Members to reject the new clause. We are talking about small businesses in 100 places in Scotland.

Mr. Foulkes: I shall be brief because for once I agree with the hon. Member for Banff and Buchan (Mr. McQuarrie). I doubt whether the hon. Member for Gordon (Mr. Bruce) has thought about co-operative societies. I am sure that if the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) were here he would not support his hon. Friend because he is a good and active co-operative supporter, and always has been. The new clause could be devastating for some co-operative societies. It is certainly not welcomed by the co-operative movement. The hon. Gentleman should withdraw the motion.

Mr. Dewar: I shall be brief because I recognise that other issues are battering at the door. I have sympathy with the motives behind the new clause. We want help to go to the right people in the right degree, but the hon. Gentleman's case in based upon a fallacy. The hon. Member for Gordon (Mr. Bruce) argued that, if money were saved, it could be given to others.
The Minister has made it painfully clear that that is not an option open to us and that there will be a substantial underspend, and I think that we can now be confident on the scheme.
Considering the real situation in Scotland and some of the figures with which the Retail Consortium has been supplying us, the case is perhaps not as clear-cut as the hon. Member for Gordon may have thought when tabling the amendment. I could think of a large number of complications about firms which have premises in different regions and different districts and the problems that would arise therefrom.
Therefore, although I have sympathy with this, my advice to my hon. Friends is not to support the amendment.

9 pm

Mr. Ancram: The hon. Member for Glasgow, Garscadden (Mr. Dewar) has made one of the basic points


which I intended to make about the amendment—that it would clearly severely complicate the Bill as well as be unfair. In particular, where there are, for instance, different stores belonging to the same company or chain but within different valuation areas, it would create difficulties to ascertain where they were and what their relationship was. I am sure that the hon. Member for Gordon would not wish unnecessarily to complicate the scheme.
The spirit of the amendment has been met, in that we have already announced that we are putting a £10,000 limit on the amount of rebate that can be obtained by any one rateable subject. I believe that that is a necessary safeguard. It was in response to a number of representations that one would find certain subjects qualifying for a lot more than that. We believed that it was necessary to put a safeguard on this. That will be included in the order. On that basis, I hope that the hon. Gentleman will withdraw the amendment.

Mr. Bruce: I have listened with interest to the points made. The hon. Member for Banff and Buchan (Mr. McQuarrie) highlighted my concern — that, given our present lack of information, some chain store operators could still take up a substantial amount of the money available. If that were the case and there were an overspend, I think that most hon. Members would appreciate the need to provide some limit.
As to the co-operatives, I accept the point made by the hon. Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes), although I could also argue that many of the co-operatives are organised in groups which would probably leave them outside the limit.
Allowing for that point and reaffirming my concern that £10,000 per premises could add up to a substantial amount for any one company, but because there is a desire to terminate the Committee and because the point has been made and registered, I can only hope that I am not proved wrong and that there are no circumstances in which it will be found that a substantial amount of money has been taken up by rebates to individual companies. Given all our assumptions on the basis of our lack of information that we are discussing amounts of £30 million or £40 million but under £50 million, and in view of the comments that have been made. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Bill reported, without amendment; considered.
Motion made, and Question, That the Bill be now read the Third time, put and agreed to.
Bill accordingly read the Third time, and passed.

Appropriation (Northern Ireland)

The Minister of State, Northern Ireland Office (Dr. Rhodes Boyson): I beg to move,
That the draft Appropriation (No. 2) (Northern Ireland) Order 1985, which was laid before this House on 8th May, be approved.
The order is being made under paragraph 1 of schedule 1 to the Northern Ireland Act 1974. The order provides the balance of the money necessary in 1985–86 for the services provided by Northern Ireland Departments and certain other public bodies. On 7 March the House approved a total of £1,323 million as "a sum on account". Today I seek the balance of £1,733 million, making up a total estimate for 1985–86 of £3,056 million. This is the figure which appears on the front of the Estimates volume which is available from the Vote Office. It is this Estimates volume which gives full details of projected expenditure.
The draft order also appropriates an additional £4 million to cover excess expenditure in the 1983-84 financial year in class VII, vote 1, which covers protective services such as the fire service, and class X, vote 2, which covers non-contributory social security benefits. These two "excess votes", as they are termed, have been examined by the Select Committee on Public Accounts which has raised no objection to them being voted. Details of the excess expenditure are set out in the "Statement of Excesses" pamphlet which has also been placed in the Vote Office.
Before dealing with the detail of the Estimates, I think it is appropriate to reflect upon the broad economic prospects. The United Kingdom as a whole is about to enter the fifth year of continuous economic growth. Recent economic indicators show that Northern Ireland continues to share in this revival. The trend for total industrial production has been upward since mid-1983 with output in 1984 3 per cent, above the level for 1983. Manufacturing production also rose by 3 per cent, in 1984 following a similar rise in 1983. As I have said before, the recovery in manufacturing has been fairly broadly based with most sectors showing some improvement. The most recent employment figures for the Province are also encouraging. Although the trend is still downwards, the rate of decline has fallen significantly. In the second half of 1984, total employment actually rose by over 4,000. However, last year as a whole there was a net decline of 660. This compares with declines of around 3,100 in the year ended December 1983 and 14,500 in the previous year.
Unemployment at around 21 per cent, remains the major economic problem in the Province. As the population of working age continues to rise, the trend in unemployment remains upward. Nevertheless, there was an overall decrease of 1,370 in the unemployment figures published on 31 May compared with the previous month, plus a decrease of 500 in the seasonally adjusted unemployed.
Recent surveys of the Province are in general agreement that investment and future employment prospects present a more cheerful picture than we have seen for many years.
Turning now to the Estimates, class I covers agriculture, fisheries and forestry and provides for expenditure of £73 million in the current financial year.


The basic aims of this expenditure are, within overall United Kingdom priorities, to help create in Northern Ireland the conditions for efficient production, processing and marketing of the products of this very important industry and to maximise the sector's contributions to the development of the · regional economy. The major constituents of the ongoing agriculture programme are £15 million for education, research and development. Some £12 million is for direct agricultural support; £27 million for administration and miscellaneous services, including support to the industry by way of advisory and veterinary services; £18 million for drainage and forestry; and £5·5 million for continuation of the milk consumer subsidy which enables a higher wholesale price to be charged by the Milk Marketing Board for milk for the liquid market while ensuring that Northern Ireland consumers pay about the same retail price for milk as their Great Britain counterparts.
While on the subject of milk, I again emphasise that I recognise the serious concern in the farming industry in the Province. The right hon. Member for Lagan Valley (Mr. Molyneaux) and other right hon. and hon. Members have been pressing the case of the particular difficulties facing certain categories of Northern Ireland producers. I want to assure the House that my right hon. Friend the Minister of Agriculture, Fisheries and Food and the Secretaries of State for Scotland, Wales and Northern Ireland are still in consultation on this question. I can say no more at the moment.
I should perhaps add, for the information of the hon. Member for Antrim, North (Rev. Ian Paisley), that it is from vote 3 of this class that we will provide a grant for the new dredger for Kilkeel harbour. I know that our decision to approve this project was welcomed by the fishing industry, and hon. Members will be interested to know that the contract has now been let at a figure of almost £400,000 over the next two years.
While on the subject of fisheries, the right hon. Member for South Down (Mr. Powell) has drawn my attention to the concern being expressed by Mourne fishermen about the scallop beds close to the Northern Ireland coast which they fear may be overfished when the beds elsewhere in the North Irish sea are closed. We are fully aware of this concern and, as promised to those who made representations last year, the scallop fishery is being closely monitored with a view to having scallop beds closed if stocks are endangered. I recognise that the right hon. Member may have other points to raise on this subject, and I will listen with interest to his remarks.
Class II, votes 1 and 2, provide for the activities of the Industrial Development Board. More than half of the £22·7 million sought in vote 1 will be directed at infrastructural developments such as factory building, site and estate developments, and £3·6 million has also been earmarked to underpin the IDB's efforts in promoting Northern Ireland as a location for inward investment. In vote 2, some £62 million is being sought for selective assistance to industry. Hon. Members will be aware that the creation and support of viable employment in Northern Ireland is a major element in the Government's economic strategy for the Province, and that we are committed to the provision of adequate resources to maintain securely based industrial projects in Northern Ireland.
Under class II, vote 3, some £93 million is being sought to provide support mainly for the Local Enterprise Development Unit, the small firms agency, the aircraft and shipbuilding industries of Shorts and of Harland and Wolff, •and for assistance under the standard capital grants scheme. Of that amount, £16·7 million has been provided for LEDU, £32·6 million for Harland and Wolff, and £6·6 million has been allocated to Shorts. Right hon. and hon. Members will be aware that Shorts has been successful in winning three highly competitive contracts since the beginning of the year. They will keep Shorts in the forefront of the aerospace industry and increase its share of defence work on the aircraft aerostructures side of its business. All those contracts should provide a secure base for employment at Shorts.
We have had the disappointing news about Lear Fan. The decision by the company to cease trading was taken in the light of further setbacks to the aircraft's certification programme and the recent steep decline in the market for executive turbo-prop aircraft. When the company ceased trading the Government's remaining commitment was $4·79 million and, obviously, that amount will not now be paid. Both the Government and the major private sector consortium involved in the project were released from their remaining funding commitments. The Department of Economic Development appointed a receiver on 28 May 1985 to secure the company's assets in Northern Ireland, and to represent the Government's interest in the assets and technology in the United States of America.
The total amount invested by the Government in the project has been some £56 million over five years. Private sector investment has been almost $100 million. I must emphasise that the failure of the project cannot in any way be blamed on the Northern Ireland work force and, indeed, their loyalty and contribution to the project is to be praised. If the project had succeeded, it would have brought very welcome high technology and employment opportunities to Northern Ireland.
Finally on the industrial sector, I should like to pay tribute to the progress made by the Province's two job promotion agencies, the Industrial Development Board and LEDU. In the year to 31 March 1985 both exceeded their targets for new job promotions. The IDB achieved 5,267, of which 4,719 were within home industry and 548 from new inward investment. Of the total of 5,267 new jobs, almost 3,400 were in companies with headquarters outside Northern Ireland.
I put that on record because, with the failures of De Lorean and Lear Fan, it is important to recognise that two thirds of the new jobs in Northern Ireland promoted by the IDB this year have been jobs in which the base owning companies are outside Northern Ireland. We want more gilt-edged companies of that type in the Province — those which are established in various countries, and whose efforts in Northern Ireland are part of a chain, not an experiment taking place in Northern Ireland and no other country. That is part of our policy and my determination at present.
LEDU achieved its best ever performance, with 4,009 jobs in the financial year 1984–85. That is an increase of 550 over the previous year.
Class II, vote 4, also makes provision for the development of tourism. The sum of £5·5 million is allocated to it. My hon. Friend the Member for Epping Forest (Sir J. Biggs-Davison) is extremely interested in that, and let me know of his interest before the debate.


Indeed, at Question Time the right hon. Member for South Down and I paid tribute to tourism as an important factor in the earning of wealth and the provision of jobs. Some 10,000 full-time jobs are provided by tourism at present in the Province.
Class III, vote 1, totals £24·2 million. That includes £12 million for 1984–85 deficit support for the gas industry, £6·3 million for conversion scheme assistance and £5·8 million for other costs, of which the main element is redundancy payments. The £6·3 million for conversion grants assumes that substantial progress can be made this year in implementing the rundown programmes of the smaller gas undertakings. As already announced, the Government will pay the full cost of conversion to the cheapest alternative method of domestic energy.
I can also tell the House that industrial and commercial consumers will receive grant of 30 per cent, of the least-cost conversion or replacement. In setting the rate at 30 per cent., consideration was given to the fact that many industrial and commercial consumers would be able to claim tax relief in relation to capital expenditure, thus effectively reducing the net cost to the consumer. In addition, some industrial and commercial consumers may be able to apply for energy conservation grants. They will be advised on this by fuel technologists from the Department of Economic Development's industrial science division.
I should also say, because the matter has been raised from time to time by right hon. and hon. Members, that churches, which as charitable organisations do not pay rates, will be treated as domestic consumers. Therefore, the Government will cover their full costs of converting to the cheapest alternative appliances for central heating.
The £5·8 million for redundancy payments is a broad estimate of what might be required in 1985–86 if reasonable progress is made. The payments to individual workers will show considerable variations depending on the age, length of service and wages of employees. The Government will underwrite redundancy terms to the level of those paid by the British Gas Corporation — a significant enhancement over statutory redundancy terms. Employees aged over 50 can also participate in the local government superannuation scheme for early retirement benefits in addition to their redundancy lump sums.
I have previously spelt out the reasons why the Government could not support the rescue plan prepared on behalf of the gas industry joint working group. I very much regret that this had to be the decision, but, facing facts frankly, I had no alternative. I had to ask myself whether the proposal, as put to me, would lead to a viable gas industry; or whether heavy and ever-increasing demands on Northern Ireland's limited public expenditure resources would continue to be made in support of gas. This £12 million per annum subsidy covering only 2 per cent, of the energy produced in the Province has risen from £2 million a year in 1974 to 1980, to £10 million a year from 1980 to 1984, to £12 million a year now.
The plan would be viable only if gas consumption in Northern Ireland increased 10 times over, and this at a fuel cost one third to one half higher than that of solid fuel. Domestic central heating by gas in the Province would have to increase from the present 3 per cent, to 50 per cent. We also considered that costs of more than £70 million were underestimated. It is as well to remember that all the gas pipes in Northern Ireland are such that one fifth of the gas put in on production does not come out on completion

—four times the leakage rate of Great Britain. They would need replacement if the gas industry were to continue.
Gas has had a question mark over it since 1977 at least, and a decision had to be made not to close the gas industry, but to say that the ever-rising subsidies would end and that we would pay for the rundown. Interestingly, one private gas company at Portadown, believing that it can continue to run at a profit or at least not at a loss, is continuing.
Turning to electricity, £95·6 million is being sought in the Estimates for payments to the Northern Ireland electricity service to compensate for the Government's present policy of pegging Northern Ireland electricity tariffs to the level of the highest in England and Wales. This necessitates a large subsidy from within the Northern Ireland public expenditure block. The burden is considerable and one which the Government view with increasing concern. There is a need to reduce NIES costs — in particular, fuel costs. Hence the recently announced plan to convert Kilroot power station fom oil to coal firing. The conversion is a major capital expenditure programme, involving some £94 million, which will take the station out of service in the years 1986 to 1988. After the station is recommissioned in 1989, we anticipate reductions in fuel costs of £25 million to £30 million per year. It will pay for itself within three to four years and represents significant public expenditure savings. It will be one of the most versatile generating stations on earth. It was originally oil-fired. It has switched to coal but remains capable of returning to oil and can switch to lignite in the future. It can be a tourist attraction as one of the most versatile electricity generating stations in discovered space. We are always looking for ways to increase morale in the Province.
We are also conscious of the contribution which local lignite might make to reducing generating costs elsewhere in the Province, and we are seeking detailed information on the planning, design and costings of a minemouth power station which will enable decisions to be made. The prospects for involving private sector investment in the development of lignite-fired electricity are also being examined.
Some other items will be dealt with by the Under-secretary, my hon. Friend the Member for Bath (Mr. Patten), when he replies. They are his responsibility and he knows much more about them.
Roads and transport are covered in class IV of the Estimates. Northern Ireland has an excellent road system which is an important factor in the development of the Province's economy. There are about one third the number of cars per mile in the Province compared with the rest of Great Britain. That is an attraction to people moving around the Province as well as an advantage to industry and commerce. Some £22 million has been provided for new construction and £56 million for operation and maintenance, within an overall budget of £98 million.
In his statement of 12 December, my right hon. Friend the Secretary of State reaffirmed housing as the highest priority among Northern Ireland's social and environ-mental programmes. Since the strategic approach to housing was agreed in 1981, total gross expenditure on housing services in Northern Ireland has grown from £325 million in 1980–81 to £545 million in 1985–86. Allowing for inflation this is a real increase of 22 per cent. A farther review of the housing strategy undertaken in 1984 confirmed the validity of the switch in emphasis made in


1983 towards improvement and maintenance and concluded that for the future the main issues to be addressed concern housing conditions rather than overall supply. That is reflected in the provision which has been made for housing services in 1985–86. The Housing Executive's capital and revenue budgets for 1985–86, totalling over £500 million, make provision for expenditure of £78 million on the rehabilitation and improvement of the executive's existing housing stock. Only — I am sorry; I mean over—£52 million is for maintenance.

Mr. Ken Maginnis: Only. The Minister was right the first time.

Dr. Boyson: Knowing how carefully my words are noted, I shall be careful when I start a sentence with a four-letter word. What we spend on one thing we cannot spend on another. A Government who have increased the amount by 22 per cent, have nothing to apologise for.
In gross terms some £42 million has been made available to housing associations for 1985–86, of which £26 million has been allocated to general housing association work to fund the completion of work already on the ground and a programme of 1,250 new starts.
In class VI, vote 1, over £78–6 million is sought for water and sewerage services throughout the Province. Of that amount, approximately £25 million is required for capital works. A major problem identified by a recent review of the future needs of the water service was the wastage of water with the percentage of water unaccounted for at some 30 per cent, of the total supply. An intensified programme of waste detection is expected to be fully under way by the end of 1985. We need to do that or to build another reservoir. The water leakage is almost as acute as the gas leakage, but I am told that it is easier to deal with. The gas leakage will not interest us in the future.
Class VIII of the Estimates seeks a total provision of over £614 million for education, libraries and arts. Some 37 per cent, of this provision relates to the payment of school teachers’ salaries.
The cost of nursery education is provided for in class VIII—a total of over £3·5 million this year. I know that the right hon. Member for Lagan Valley is concerned about this matter and intends to speak about it tonight. I shall listen with interest to what he has to say, and my hon. Friend will, of course, reply.
In class VIII, vote 2, where total provision of £106·5 million is sought for higher and further education, I am particularly pleased that provision has been made to start the development of the Magee campus of the university of Ulster. The capital cost of the project will be in the region of £6·5 million at today's prices. The full plan, which is to be implemented in three distinct phases, will provide approximately 750 additional places for higher education in Londonderry and will bring the total capacity of the Magee campus to 1,000.
Class IX provides for health and personal social services. A net total of £642 million is sought to maintain the services already provided, and to allow for their further development. The largest single element in vote 1 is the revenue expenditure of the health and social services boards, estimated at £521 million.
Finally, in class XI, a net total of £18·3 million of the £23·1 million is required to service Department of Finance

and Personnel's central management functions such as resources control. The balance is to provide for the running costs of the Exchequer and Audit Department and the Northern Ireland Assembly.
I thought it right to go into some detail on Lear Fan and the gas industry, but generally I have tried to outline briefly the main features of the draft order, and to expand upon some of the main policy issues underlying the provision sought. I know that, as usual on these occasions, right hon. and hon. Members will wish to express their views on these and a great many other matters. I shall listen with great interest to the points raised by hon. Members, and my hon. Friend will reply.

Mr. James Nicholson: I wish to examine class V, which deals with housing, and to raise some matters that have affected my constituency for a considerable time.
The availability of renovation grants is causing concern. Many people find it difficult to qualify at one of the so-called entry points and that suggests to me that the conditions are too rigid, lack imagination and require a rethink.
I shall outline some of the difficulties that I have faced in dealing with constituents’ problems. We seem to be getting different interpretations from the Housing Executive in different areas. More important, we are getting different interpretations from different grant officers in the same areas.
It is not acceptable to be informed by the Housing Executive grants department and its officer that they have learned a lot in recent years. One would expect that, but constituents are having to wait 12 months or even 24 months for approval for a renovation grant for a house that badly needs renovating. That causes serious concern.
Many houses which do not meet the so-called entry requirements badly need improvement. The owners cannot afford to carry out the work but unless they are in receipt of supplementary benefit or other state benefits they do not qualify for assistance at the higher rate. I have never understood how or why we have developed a system whereby people have to be in receipt of state benefits to be able to renovate houses, as I should have thought that people on such benefits would be in no position to consider renovating their dwellings.
I should make it clear that this is a personal view, but I have long believed that the system lacks proper balance. Many people who do not qualify for grant aid are encouraged to improve their houses, when, if they had the choice, they would opt to build new ones instead. I ask the Minister seriously to consider adopting a more balanced approach to renovation and new building so that those in a position to choose can set the cost of renovation against that of building a new house, including whatever size of grant is available. The difference between the two amounts would then be less than it is now, thus allowing people more realistic alternatives than they have at present.
The problems of Orlit houses, of which there are many in my constituency, were being discussed in the House long before I joined its ranks, but we are still nowhere near solving the problem and alleviating the plight of the tenants, many of whom have had to accept continual increases in rent. I ask that every effort be made to ensure that progress is more rapid than it has been so far. I believe —I have argued this with local officials of the Housing


Executive and I do not think that many disagree—that where possible the Housing Executive should sell the houses to the tenants at a price which reflects the condition of the houses. I believe that that would be more attractive both for the potential purchasers and for the Housing Executive. Many tenants of Orlit cottages in my area have told me that they do not want their houses to be pulled down and they do not wish to move elsewhere. They are content to stay in their present homes. I do not believe that sufficient consideration is given to that fact.
There is also growing dissatisfaction not just in my constituency but throughout Northern Ireland among Housing Executive tenants who keep their homes in an excellent state of repair but are awarded no consideration for that. That can no longer be acceptable to the vast majority of responsible citizens. Many estates in my area were built a very long time ago and require modernisation and rehabilitation, including rewiring and better heating systems. The tenants rightly insist that they should be given consideration, and I agree.
Tenants on some estates in Armagh city such as the Folly in Dobbins Grove and the Orangefield estate are angered when they see tenants who wreck the kitchens and bathrooms in their accommodation being transferred by the Housing Executive to new houses in other areas. When I am asked by tenants who have looked after their homes how the Housing Executive can justify neglecting them, yet helps tenants who have wrecked their houses, I find it impossible to justify.
Houses on an estate at Sinton Park in Tandragee are supposed to be equipped with a so-called kitchen-dinette. In fact, it is nothing of the sort, being too small to be of any use to the tenants. That estate requires modernising and improving.
I protest strongly on behalf of tenants living in houses on the Greenpark estate in Markethill. Their doors and windows are rotten and people have to stuff up holes, in the windows and elsewhere, with polythene. A rehabilitation scheme for that estate has been postponed for another 12 months. That is totally unacceptable to the people who live there, and I find it intolerable.
In Killylea there is an estate of old people's dwellings, and other houses in the main street, and Eskes Park which to this day have not had their roofs or walls insulated. Nor do they have proper heating systems. That, too, is an unacceptable state of affairs. The walkways to the houses are dangerous, yet we expect old people to walk on them. I cannot understand how contractors have been paid for some of the tarring that they are supposed to have done there. It is difficult to see what supervision the Housing Executive exercised before payment was made for that work.
We require a change of emphasis in the Housing Executive's policy, particularly to the rural areas. Northern Ireland does not end at the suburbs of Belfast. Other areas outside the main conurbations need improving. People who have been paying their rents as honourable and honest citizens are now demanding what they should have received years ago. "We want our homes brought up to an acceptable level. Why should others have had their houses improved, while ours have remained in this condition?" they are rightly asking.
Houses on the Mourneview estate at Tandragee have caused me to have much correspondence with the Under-secretary of State for Health and Social Security in recent months. That estate was built many years ago, before the

motor car became popular, when most of the tenants, used bicycles or walked. Tandragee council—long before the Housing Executive came into existence—constructed a green area in front of the houses so that people would have a pleasant aspect. That was all very well then, but today every household on that estate has a car. Some have two and I know of one that has three.
That area of what was green grass has been trampled on to such an extent that in the winter it has to be seen to be believed. The children from neighbouring estates find it an excellent track for their BMX bicycles. They tear through the mud and the residents have difficulty getting to their homes. The footpaths have been allowed in recent years to get into an atrocious state, with the flagstones so unbalanced as to be dangerous.
The Department of the Environment roads service informs me that it does not propose to spend money on the estate because such expenditure would result in no traffic benefit to the area. Meanwhile, the Housing Executive is willing to pay 50 per cent, of the cost of making improvements. The Department says that such improvements would not benefit through traffic, but the roads service cannot wash its hands of its responsibilities unless they are clearly defined as a Housing Executive responsibility. I should be quite happy for such improvements to be made the responsibility of the Housing Executive because it might be prepared to solve the problem. It is unacceptable that people should be asked to live in out-of-date accommodation.
Although I have said a few harsh words about it, at this stage I should like to say a few words in praise of the Housing Executive. It has tried to respond to the requests that have been made for housing repairs. Its response could have been better, but there has been an improvement.
Rates offices have been centralised throughout Northern Ireland. The rates office in Armagh city was closed and removed to Lurgan. Most of the people in the area would have gone to Armagh to pay their rates bills. Either they decided to pay them within the allotted time and to accept the discount that was offered or they decided to pay their bills outside the time limit and by waiting long enough, hoped that it would amount to more than the value of the discount.
Lurgan is not very far away but it is far enough away not to tempt anybody in the Armagh district to jump in his car and go to Lurgan to pay his rates bill. So they now pay their rates bills by post. One of my constituents paid his rates bill by post three days before he would have lost his discount, but the Post Office decided not to deliver his letter for four days. Therefore, he lost his discount. It ought to be possible for the postmark to be taken as a verification of payment having been made before the expiry of the discount period. May I ask the Minister of State seriously to·consider that point?
The Minister of State referred eloquently to the excellent roads system in Northern Ireland. The Armagh county council left as an inheritance to the people of the county of Armagh a roads system that was second to none. But that cannot be said today. The main roads have deteriorated seriously. The byroads have gone beyond the stage of deteriorating; some of them are beginning to break up.
There are all sorts of problems. I do not propose to deal with them at any length, because that would take up so much time that I might deprive another hon. Member of the opportunity to speak. However, I am seriously


concerned about road conditions in Northern Ireland as a whole, and particularly in my constituency. I am also concerned about minor roads and voiced my concerns about them before I became a Member of Parliament.
One road in Armagh was first known as the road to nowhere. Now it services a housing estate, but it has never been finished. It was designed as a link road between the Markethill road and the Portadown road, and was supposed to cross the Hamiltonsbawn road. That road was never completed to a point at which it could at least provide some assistance. Thus, I hope that the Minister will seriously consider the fact that the road needs to be finished.
We have a good industrial estate on the Hamiltonsbawn road. It needs to be serviced and needs further work to be done so that more jobs can be brought to the Armagh city area. If there are no roads to such estates, we cannot expect industrialists to give them serious consideration. The Minister must give that point top priority in future.
The Under-Secretary of State, the hon. Member for Bath (Mr. Patten), need not look so worried, as I shall now deal with class I. I know how proficient he is on agriculture, as I have heard him reply in the past in the House. Farm capital grants are important to our farmers. Indeed, it would be fair to say that in Northern Ireland we have in the past used the grants available to improve and modernise our farm buildings. But even more importantly, improvements to our grasslands by re-seeding, shoring and cleaning out drains have benefited the whole agriculture industry. When the grants were drastically cut last December, there was some alarm. Of the £40 million saved from those cuts in the United Kingdom, £14 million will come out of money that would have gone to Northern Ireland. That shows the importance that Northern Ireland attaches to the grant system and the use to which it can be put.
Some counties require an on-going drainage policy. County Fermanagh is an excellent example of where such a policy has improved the land and subsequently the livelihood of farmers in that area.
I am very concerned that areas that have been substantially improved in previous years will now deteriorate. The view now appears to have entered Government thinking that the removal of hedges has been in some way uniform throughout the United Kingdom, but that is not so. Anyone who has been to Northern Ireland will know that conservation has always been of paramount importance to Northern Ireland farmers. We have not been guilty of damaging conservation, and could not be accused of that. The Minister's colleagues may not be as aware as he is of the different circumstances prevailing in Northern Ireland. We need an on-going policy of improvements to grasslands in Northern Ireland.
If agriculture is to develop, research and development must continue to receive the necessary support. There must be no diminuition in the current standards. We would be opposed to the reduction of any of the current services offered by our experimental stations, veterinary research laboratories, plant breeding stations and many of the other services. Major companies presently take part in some of the work carried out by Government Departments, and while such a policy should be encouraged where feasible, it should never be considered to be capable of taking over from what currently exists.
Production of beef in Northern Ireland provides great support not only for the farmer but for ancillary industries, mainly in the boning of beef. Agriculture in Northern Ireland must look towards preparation and marketing to give the housewives what they wish to buy. That aspect has been sadly lacking over the years. However, that requirement now seems to be recognised. If we are to survive in the comparative market of the large multiples buying the highest quality at comparative prices, there is much to be done on marketing. We still have a great deal to learn if we are to compete effectively with the continent. To that end, I urge the Government to maximise their efforts in helping our firms to initiate new ideas, evolve new markets and adopt new ideas to the benefit of the industry.
One requirement has been sadly neglected for some time—cold storage and blast freezing facilities. Due to the large supply of cattle available in the autumn, intervention is required to stabilise the market, but intervention is of little consequence if there is no storage space. I understand that the stores are now almost full. If that is true—I have no reason to suppose otherwise— that does not hold out much hope for the coming season. We experienced problems last autumn but, thankfully, we coped. We may not be so successful this year.
I ask the Minister to give serious consideration to providing alternative facilities. I fall short of saying what we said 12 months ago, when we requested that freezer ships should be made available. But that is something that the Minister must seriously consider, because that facility may be required this year in view of the additional cow beef that has filled our cold stores. The Minister should not hope for the best—he should prepare for the worst.
Since I came to the House two years ago, I have repeatedly said that some way must be found to bring to Northern Ireland at a realistic price the grain that is currently housed in costly intervention storage in Europe. It should not be beyond the scope of our Ministers and officials to negotiate within the CAP a way in which grain could be shipped to Northern Ireland, stored and sold to Northern Ireland farmers at a price no more or less than that in any other part of the United Kingdom. Such an initiative would immediately stabilise the intensive sector and would be of great help in creating further employment in the ancillary and support industries that supply it. I urge the Minister to take the necessary initiative to ensure that the problem is seriously considered.
I apologise to the Minister for not having been in the Chamber to hear his opening remarks on milk quotas. Like many other hon. Members, I was taken by surprise by the speed with which the previous debate ended. The issue of milk quotas has caused those of us who present the Northern Ireland agriculture case a great deal of concern, and we have spent much time trying to find a solution to the problem.
The problem was created by the Minister of Agriculture, Fisheries and Food. When quotas were first introduced 14 months ago, Northern Ireland should have been awarded 65,000 tonnes in recognition of its dependence upon the milk industry. That would have placed Northern Ireland farmers in an interim position between the Republic of Ireland and the remainder of the United Kingdom.
That is the background to the position. However, now the dairy farmers of Northern Ireland are at a serious disadvantage compared to their counterparts in the rest of


the United Kingdom. Not only did they not receive the 65,000 tonnes that we were awarded, but we were manipulated out of the commitment by a jumbling of figures to suit the requirements of the Ministry of Agriculture, Fisheries and Food.
The Minister introduced throughout the whole of the United Kingdom a milk cessation scheme whereby fanners could, if they wished, sell their quota back to the Ministry and go out of production. That extra quota could then be redistributed. In England and Scotland the scheme received a favourable response, but not in Wales, where in many ways the position of the farmers is similar to that of those in Northern Ireland. The target set for milk quotas has almost been reached on the mainland, but not in Northern Ireland, because the scheme there was a flop.
When the Minister of Agriculture made his announcement offering the scheme as a solution to the difficulties in Northern Ireland, he did not heed the warnings given by myself and other hon. Members that the scheme would not work. It never had a chance to work, because in Northern Ireland the farmers have no alternative. They cannot turn to cereals as farmers in other parts of the United Kingdom can. It has been suggested that other choices are available—we could grow rape, flax, peas and, unbelievably, caravans.
In Northern Ireland, we depend mainly on the grassbased sections of milk, beef and, to a lesser extent, sheep, those involved cannot sell their quota and go out of production. Our dependence on this sector is now more pronouned than ever. The dairy produce panels set up with the approval of the House to help farmers in the United Kingdom as a whole and to investigate their appeals is now working to the detriment of one part of the United Kingdom.
The same legislation and criteria should be used throughout the United Kingdom. Recently, the Minister announced that dairy farmers in England, Scotland and Wales are to receive 100 per cent, of their exceptional hardship awards, but in Northern Ireland they are to receive only 36 per cent. In England, Wales and Scotland, the small producer of 200,000 litres is to receive an extra 11 per cent, over the next 12 months, but in Northern Ireland, he is to receive nothing.
Such treatment is unacceptable to Northern Ireland. It is wrong that a farmer living in England, Scotland or Wales should be 11 percent, better off than his counterpart in Northern Ireland, who is in the same circumstances but who, because he farms in the Province, will not receive equal treatment. Northern Ireland farmers have been told to cut milk production by 1 per cent, from 1 April, but small farmers in the rest of the United Kingdom are 11 per cent, better off.
It was fair 14 months ago to equalise the hardship, and the Government have a duty now to ensure that all citizens receive the same benefit. There is no difference in being an exceptional hardship case in the county of Armagh, part of which I have the honour to represent, and being an exceptional hardship case in the county of Devon. Hardship is the same wherever one happens to live. No justice or fair treatment has been accorded to Northern Ireland fanners on this issue. Tonight I am asking for that —nothing more or less than equality will suffice.

Rev. Ian Paisley: I want to refer to a matter that has just been dealt with by the hon. Member

for Newry and Armagh (Mr. Nicholson) in regard to the Department of Agriculture. Lord Lyell, who is responsible for agriculture, advised us that expander cases in Northern Ireland would receive 49 per cent, of tribunal awards. In Scotland they will receive 57·5 per cent, and in England and Wales 65 per cent. If the outgoers quota is used exclusively for exceptional hardship cases and additional quota is not transferred from Great Britain awards of 36 per cent, will be granted.
The Secretary of State for Agriculture announced on 7 May that exceptional hardship cases in England and Wales would receive 100 per cent, of the tribunal award. Small producers in England and Wales will be restored to their mean level of production in 1983 but again, unless quota is transferred from Great Britain, small producers in Northern Ireland will receive absolutely nothing.
It is all very well for the Minister of State to come to the Dispatch Box tonight and tell us that he cannot make further comment. What are the dairy farmers of Northern Ireland to do? Lord Lyell told the Ulster Farmers Union on 2 May:
I would wish to register my most sincere sympathy with all those who still do not know how they stand for 1985–86. I can only assure you that I am doing everything I can to get a fair settlement as quickly as possible.
The dairy farmers of Northern Ireland deserve not sympathy but action, and action needs to be taken immediately. We are in an intolerable position when we discover that the Minister who will be answering tonight can make no statement about further progress on the matter while the rest of the United Kingdom gets full information. There is no equality between the rest of the United Kingdom and Northern Ireland. The hon. Member for Bath (Mr. Patten) should be well briefed so that he can give some satisfaction to the people of Northern Ireland.
I wish to protest at the limitation on the time available for the debate. Why can we not have proper time to discuss matters that range from Dan to Beersheba? It makes me thank God doubly for an Assembly, where we have time to discuss some of the matters that should have been dealt with in the House tonight. We have a deplorable state of affairs.
When I arrived at the House today I had a telephone call from a lady in County Antrim who told me that she could not get any satisfaction from the Department of Agriculture in Northern Ireland or from the Department here. Therefore, she sent to Mr. Andriessen, the Commissioner for Agriculture in Brussels, a long telex which cost her £60. This is a serious matter because the dairy farmers do not know where to turn. They may have 100 or 120 cows and they are being told that they will have to cut back. They do not know how they will make ends meet. Mr. Andriessen replied to this lady. She got no reply from the Prime Minister or from the Secretary of State for Agriculture, both of whom she had written to. She was ignored by them but the Common Market Commissioner replied. He said that he had instructed
 "my services to get in touch with the United Kingdom so that further details and a proper explanation be obtained of the way that hardship quotas and other special case quotas are now being determined in Northern Ireland differing from the rest of the United Kingdom".
The alarm bells are sounding in Europe because of the way in which the Secretary of State dealt with the 65,000 extra tonnes that we should have received last year.
What is happening is deplorable. It is so bad that it would be impossible to believe if Lord Lyell had not


appeared before the Northern Ireland Agriculture Committee to confirm in person what I am saying tonight. He said that the only answer lay in the permanent transfer of quota from Great Britain, but that there was very strong opposition to this from producers in England, Scotland and Wales. In other words, those producers are not prepared to stand for equalisation and Northern Ireland has to be put out on a limb.
Northern Ireland's prime agriculture industry has to suffer because the Minister of Agriculture, Fisheries and Food has ceased to be the Minister responsible for the whole of the United Kingdom. He has become responsible only for England and Wales. He is doing something for his own fanners but nothing for farmers in Northern Ireland.
It was obvious to the Agriculture Committee that that would be so. Indeed, we put it to Lord Lyell that a political decision would have to be taken to transfer quotas from producers across the water.
I am sure that the leader of the Official Unionist party will not mind me saying that he has received correspondence from the Prime Minister on the same subject. I have also written to the Prime Minister about the problem. Lord Lyell told us that the Secretary of State had been negotiating at Cabinet level and that we would have to leave it to him to fight the political battle.
Representatives of the Ulster Fanners Union came away from a meeting with the Minister of Agriculture, Fisheries and Food and immediately passed a vote of no confidence in him because he offered no change and no hope.
I appeal to Ministers to convey to Lord Lyell and to the Secretary of State that time is running out. In the past two weeks we have heard that producers in the Republic of Ireland have received an additional 58,000 tonnes. In England and Wales there has been a restoration of the 1983 levels of production and claims by essential hardship cases will be met in full.
It is time for Northern Ireland's position to be resolved. We must receive the full benefit of the European Economic Community award of 65,000 tonnes. It must be seen that we receive that award. Surely Ministers have learnt their lessons by now. There must be a permanent transfer of quota within the United Kingdom to protect the jobs of those for whom alternative employment is not available. There are no alternative jobs for farmers. We have a grass, land-based industry.

Mr. Nicholson: Does the hon. Gentleman agree that we can thank membership of the EC for our present position, and for having ruined our intensive sectors, thus making us so dependent on the grass-based sectors?

Rev. Ian Paisley: The hon. Gentleman knows my views about Europe. I warned the Ulster Farmers Union, but they went against me and said that Europe would be the greatest thing that ever happened. The leaders of the farming community in Northern Ireland campaigned to go into Europe. The farming community was warned about what would happen. What annoys me is that Europe has given us extra and we are not getting it. It is hard for the farmers of Northern Ireland to accept that producers in the Republic will be so much better off than we are. But how much worse it is now for those in agriculture in Northern Ireland to find that matters cannot be resolved on an equitable basis within the United Kingdom, that we are not

getting our place as farmers within the United Kingdom, that we are being discriminated against. There must be a realisation of the inequities between producers in the United Kingdom.
Justice surely demands that quota purchased from outgoers should be used equitably throughout the country. The Government cannot say that the money is not available, because the money is available. They were to purchase 66 million litres, and they have been able to purchase only 12 million litres. They have £7 million in hand to pay for this. That money must be used to get extra milk quota for Northern Ireland. The money is available. A simple calculation shows that a total of £7 million is unspent. The Government must make that money available for milk quota.
I leave it to the Minister to reply on milk quotas when he sums up, and to give some hope to the farmers of Northern Ireland. I do not want him to say that he is sorry, he can do nothing and he has nothing to say to me, because that will inflict more misery and take away any hope that there may be in the hearts of the fanners of Northern Ireland.
There are many other agricultural matters on which I would like to comment, but many other hon. Members wish to take part in the debate and some have been waiting since 7 o'clock. I will, therefore, curtail my remarks.
I welcome the statement of the Minister of State that there is absolutely no criticism of the workmanship of the people of Northern Ireland in the De Lorean case or in the Lear Fan affair. These companies coming in and making a botch has caused a reflection to be cast across the world suggesting that there is something wrong with Ulster workmanship. There is nothing wrong with Ulster workmanship. I welcome this statement by the Minister, and he needs to go on repeating it, because no reflection can be cast on Ulster workmanship.
I welcome the progress that has been made in Shorts and in the Shipyard, and I welcome the jobs that are coming to Northern Ireland. There is a lot of work to be done, and the IDB and those responsible need to get their skates on and get at this job with all their might.
I wish to ask some questions on class IV, the Department of the Environment. Can the Minister give the House a recent updating in regard to Ballintoy harbour? I thank the Minister for what he told me about the Kilkeal dredger. I want to say that I was not going into the constituency of any hon. Member. The hon. Member for Newry and Armagh (Mr. Nicholson) and I at a meeting in Stormont were asked to bring this matter to the House. As chairman, I was asked to do this, and that is why I did it. When hon. Members came into my constituency at the time of the discussion of the barracks at Ballymena, I did not protest. If hon. Members come in and help my constituency to get better and more jobs, more power to them. It is the same if they come into Shorts in the constituency of my hon. Friend the Member for Belfast, East (Mr. Robinson). Nobody will hinder me. When representations are made to me as chairman of the committee in Stormont to raise matters in the House, I will raise them.
I welcome the fact that the Minister gave us the report, but we had already had it from the chairman of the fisheries board in Northern Ireland who came and told us what had happened. Nevertheless, we welcome the announcement today.
I want the Minister to tell us about the updating of Ballintoy harbour. Extensive works have been done there, but the project has developed into a fiasco resulting almost in the closing of the harbour because of the way that the work has been carried out. Will he also say what progress has been made on Rathlin island harbour and on the Ballycastle harbour project as these are very important to my constituency?
Class V deals with housing. I want to ask the Minister to start an investigation into why houses of the same age and of the same construction and size in one area in Northern Ireland get more done to them when they are being rehabilitated than the same type of houses in other areas.
I refer to Cookstown and to Ballymoney. There, two estates are made up of exactly the same type of house, but the political connotations are different. One is Republican and the other Unionist. One is Roman Catholic and the other Protestant. A tenant goes to the estate office and is told, "We are sorry, but you are not getting a new window here and a new door there and you will not have this or that fixed. At the end of the day, people in Ballymoney found that inferior jobs were being done on their houses and less money was spent on them although their houses were in a worse condition than those in Cookstown.
I have had the Housing Executive on this job, because the only way to deal with the Housing Executive is to take its representatives to an estate and allow the tenants to get at them. That is my policy. I allow them to say what they have to say to the Housing Executive in the presence of their Member of Parliament. I got promises galore that all would be well. However, I was summoned back and the tenants told me that they were getting nothing and that the Housing Executive representatives had gone back on their agreement. I say to the Minister that what is fair must be done in Northern Ireland.
I resent the fact that in my constituency Republican housing estates get preference over Unionist estates. They should all be dealt with in the same way. Instead, Republicans destroy their properties, they refuse to pay rent, they go on rent strikes and, when renovations are to be done, the Housing Executive says that their houses are in worse condition and that work on them must be done first.
Good tenants in Housing Executive property must be given some incentives. I understand that the Government believe in incentives, as I do. A good tenant who keeps his house well, does the odd repair without fuss and keeps it in good repair should be given some incentive. I am disgusted by the way that some of these rehabilitation jobs are done. Tenants are put out for a few weeks, but they are brought back before the jobs are finished. Other tenants are kept in their houses and have to endure all the inconvenience. I went into a house the other day where the occupants were going to bed after performing a balancing act over the rafters of the floor. That was a rehabilitation job. That is not fair to anyone, and the Minister should see that it does not happen.
Class VI deals with historic monuments, and I have two questions for the Minister. The first concerns the Walker monument in the city of Londonderry. Incidentally, I congratulate the Minister on calling it "the city of Londonderry". Because we have murdering thugs as members on the council, is the planning for that monument to stop, with the project being called to a halt?
I want also to ask the hon. Gentleman about the monument to the Rev. Hugh Hanna that used to stand at Carlisle circus. What has happened to it? Why has the monument not been restored to its rightful place now that the roads in the area have been sorted out?

Mr. Peter Robinson: While my hon. Friend talks about monuments, will he give the Minister the opportunity to tell us what is delaying the cleaning of the Carson monument which is on the route to my hon. Friend's offices and which he must see and deplore every day, as it is turning green and corroded?

Rev. Ian Paisley: I thought that my hon. Friend would speak in the debate and I knew that he, as chairman of the committee in Stormont, had made representations about that matter, which is why I did not mention it. We could not get a better trio than Walker, Hanna and Carson and, therefore, I trust that those three names will stick in the mind of the hon. Gentleman the Member for Bath and that he will remember that that monument of Carson needs a bath. Perhaps he will look after that for us.
Regarding class VIII, I register my strongest protest against the decision that Northern Ireland will have something less than the rest of the United Kingdom in that we are not to have a Provincial library or copyright privilege for our central library. It was proposed that we should have a Provincewide reference library and a copyright privilege. Only one library in Ireland has that copyright privilege — the university library in Dublin. Why should a library outside the United Kingdom have that privilege when it is denied to the people of Northern Ireland? Wales, Scotland and England all have their own national library. Why should Northern Ireland not have one to serve the entire Province? I regret that it has been refused to us. Will the Minister tell us why?
I wonder whether the Minister will tell us what is happening about hospitals at Downpatrick. All hon. Members have deputations with them about that. I hope that the Minister will update us on that.
Class XI vote 4 deals with the expenditure of the office of the Northern Ireland Parliamentary Commissioner for Administration. Will the Minister take on board the fact that a small leaflet is needed to state clearly how many cases have been brought since the two offices came into existence? How many cases have been sifted through, tried and a verdict given? What was the religious discrimination and what were the numbers? Those numbers are vital to show that the vast claims of discrimination simply do not stand up. It is time that the facts were published so that everyone knows what is happening.
One of the classes refers to the contributions to local revenues. I think that I can deal with this matter in class IV vote 6. The Minister knows what has happened as a result of the Northern Ireland local government elections. I do not want the Government to think that the problem will go away. Sinn Fein is wholly unacceptable to the people of Northern Ireland. To have to sit on a council and have councillors shouting, "Up the IRA", and calling our security forces murderers, and to know that Sinn Fein has killed our kith and kin is something that we shall never accept. The Government need to get that into their mind. If they think that in two or three months, or a year, the position will settle down, everyone will shake hands and work together, they are wrong. If the Minister thinks that


he can push Sinn Fein down our teeth, he has another think coming. The Government need to get that into their mind and heart. What they have seen so far is only a Sunday school picnic. Our people are enraged at what has happened. The Minister and the Government will not sit with Sinn Fein, discuss business with them, or have them on deputations, yet they would force the elected representatives of Northern Ireland to sit with them. It cannot be done. I hope that when the Minister replies, he will clarify the statement that he is reported to have made, on which there has been great comment, that he would have to recognise the chairman of a council even if he was a member of Sinn Fein. What is the Government's thinking on that? If a council such as that in Omagh sends him a deputation led by a Sinn Fein chairman, will he receive it? If he goes to Omagh, will he be received by a Sinn Fein chairman?
Those are urgent matters, and the House had better understand the feeling of the people of Northern Ireland. I cannot express it strongly enough. I have already expressed it to the Minister in person. This cannot be swept under the carpet, and it will be opposed by the people of Northern Ireland. In Enniskillin—I regret that the hon. Member for Foyle (Mr. Hume) is not here tonight — the official Unionists were prepared to vote into office an SDLP man to keep Sinn Fein out of the chair, but the SDLP said, "We will not even run for office. We will let Sinn Fein have the chair." We know what the end of the story will be. I am not a prophet or the son of a prophet, but at the next general election, we shall see the real pact between the SDLP and Sinn Fein. I believe that the right hon. Member for Lagan Valley (Mr. Molyneaux) said in the House that we are seeing the forging of another all-Republican pact. The House must be warned about it and about the feelings of Ulster people.

Mr. J. Enoch Powell: It may seem a poor response to the witty and informative speech with which the Minister of State introduced the order if he is obliged once again to listen to a litany to which he has already on three separate occasions made some reply. All of us hope — that hope is reinforced by the absurdly limited time for this debate—that this will be the last occasion when we must reap the absurd fruits in procedural terms of the old determination to maintain a separate financial organisation and Consolidated Fund for Northern Ireland.
It would be unreasonable to expect Ministers to anticipate what we believe the Government will say if, later this month or at the beginning of July, they must once again excuse the renewal of direct rule. Equally, I am sure that Ministers will understand that right hon. and hon. Members on this Bench, who were returned to the House to bring about the end of that colonial status of direct rule under which the Province labours, would be falling if they did not mark their purpose again by formally voting against the order.
As a result of a communication between us, the Minister of State anticipated one point that I shall raise this evening. I am grateful to him for recognising that the Northern Ireland Office and the fisheries division of the

Department of Agriculture are alive to the risks to the scallop fishermen on the Down and Antrim coasts. Something went wrong somewhere.
In the early months of 1984, it was proposed that the entire northern part of the Irish sea should reasonably, for conservation reasons, be closed to scallop fishing for four months from June to October. That was accepted by the Northern Ireland fishermen and their representatives. However, when the order was made, it excluded from the ban the coastal scallop beds of the counties of Antrim and Down. That is an extremely serious matter, for there are fishermen in the smaller ports of those two counties who are dependent for a considerable part of their livelihood upon the special scallop fishery to which their fishing methods are adapted off their own home ports. If, during this close season, which does not apply off Mourne and Antrim, part of the fishing effort of the remainder of the Irish sea proves to be concentrated, as is feared, upon those beds, there may be disastrous consequences from which those resources may take years to recover.
I hope that when the Minister replies, he will be able to reiterate more precisely the pledge which was given by the Minister of State that the Government will stand ready, if there is any evidence of incursion into those fisheries, to extend the ban which exists in the remainder of the northern Irish sea. I believe that I caught an affirmative indication. I shall look forward to hearing it verbally when the Minister replies.
The other matter that I wish to raise concerns the Minister's responsibilities for the Department of the Environment. One of the few functions—I hope that it will soon be widely extended — of the existing local authorities in Northern Ireland is the disposal of refuse. I am not for one moment suggesting that that function should be taken away from them. We should be looking for functions that can be given to, not taken away from, district councils. I am not the only Member representing Northern Ireland who has been disturbed by the evidence of the sporadic efforts of the different district councils to solve their problems of tipping and rubbish disposal in apparent isolation from what other councils may be doing and without any connected plan or forethought as to what the demand in future years will be.
There is a function here for the Department of the Environment. It is a function that the Department would have even if we in Northern Ireland possessed, as we hope to possess, a full system of local government—that is, of co-ordination and stimulus. The district councils ought, each in their respective areas, not merely to be encouraged but to be required to provide the Minister with a forecast of the expected disposal requirements of coming years and their intentions for coping with their problems. There should be a survey of the manner in which the total requirements of the Province in coming years can be met without any breach of planning requirements or damage to amenities.
At present, the district council picks upon a site, causing widespread alarm and dismay in the area, and puts in a planning application for its use as a tipping site. After many months, a decision is rightly taken that it is not a suitable site and the same blight lands in another place.
It is absurd that that should be going on simultaneously in one district area after another, and it is only the Minister and officials in his Department, with their oversight of local government and environmental functions, who can deal with that problem.
I know that it has been brought to the Minister's attention, but I hope that he will tonight say that he will not allow district councils to prevaricate, but will insist by a given date on having an intelligent and intelligible plan for the next 10 years of refuse disposal throughout the Province. The matter needs to be looked at Province-wide and on that scale.
As the Minister with responsibility for the Department of the Environment is to reply and as housing has been mentioned more than once, I cannot resist returning to one point which was touched upon by the Minister of State when he referred to the change in emphasis which had taken place in the activities of the Housing Executive. The emphasis has changed from new building and addition to the total stock to improvement, maintenance and the improvement of the distribution of existing stock.
Year after year, we have called for — and then welcomed—that change of emphasis. I know that it has the full support of the Under-Secretary and it is, therefore, a cause of dismay to find in one's own constituency that the Housing Executive is apparently still contemplating vesting large areas to create new and, in some cases, massive estates. Will the Under-Secretary put in hand an inquiry to see what sites for new building are being acquired by the Housing Executive outside Belfast and how those acquisitions are related to the policy of the executive, as it has been expounded to the House in successive debates? Some of us suspect that the Housing Executive, or certainly some of its departments, may be failing to respond to the general policy of shifting the emphasis from the creation of new housing estates to the maintenance and improvement of existing houses and the facilitation of transfers so that families match the accommodation much better than they do at present.
I know that I am appealing for something which is close to the Under-Secretary's heart, and I hope that he will emphasise that when he replies.

Sir John Biggs-Davison: The right hon. Member for South Down (Mr. Powell) has announced that the House will again be divided. I regret that, if only because it separates him and his right hon. and hon. Friends from Conservative Members who wish them well.
Northern Ireland is fortunate in the devotion and energy of the Secretary of State and his ministerial team. If I pay a particular compliment to the Minister of State, my hon. Friend the Member for Brent, North (Dr. Boyson), it is because I wish to speak about tourism, which falls within the purview of the Department of Economic Development and is a subject in which my hon. Friend takes a keen personal interest.
Expenditure on the development of tourism in the last financial year is recorded in class II, vote 4. The fact that a surplus of over £213,000 is to be returned is indicative of prudent administration. The Minister of State said that in the present financial year there will be expenditure of £5·5 million. The question is whether we are getting value for that money.
In 1967, about 1·8 million tourists visited Northern Ireland. Then came the troubles. A low point was recorded in 1981, with only 588,000 tourist visitors. By last year, there had been a remarkable change for the better—to 908,000 tourists, an increase of 6 percent, on 1983 figures and 27 per cent, up on the 1982 level. There was also last

year the highest occupancy rate of hotel bedrooms—40 per cent.—since 1973. I saw that the Minister of State was quoted as predicting that the 1 million tourists mark will be passed this year, although, as that will not take us back to the pre-troubles level, we cannot rest content.
Northern Ireland is fortunate in Sir John Swinson, who was reappointed chairman of the tourist board in 1983. He and his officials have been busy promoting Northern Ireland in London, Birmingham, Scotland and West Germany—the earnest anglers from Germany love the Fermanagh lakes.
Northern Ireland has been receiving about 52,000 tourists a year from North America, many of whom come because of their roots in Northern Ireland. It is estimated that 20 million North Americans, 850,000 Australians and no fewer than 200,000 New Zealanders consider themselves, as I do, to have ancestral origins in the Province. It was wise of the Northern Ireland tourist board to carry out a promotional tour of Australiasia last October. It is also gratifying that more Members of this House are visiting Northern Ireland.
Many new visitors to the Province express surprise at the tranquillity of the matchless countryside and at the normality of Ulster life. Terrorism is there, but terrorism is almost worldwide in what Churchill described as this terrible 20th century. The British are insular and inclined to think that they are the only people who have troubles, whether it be unemployment or terrorism. Other countries much favoured by holidaymakers — France, including Corsica, as well as Italy and Spain — are also and perhaps worse plagued by the men of the bomb and the bullet. Statistical comparison shows that Northern Ireland is much safer than New York and we should do all that we can to encourage further growth of the tourist industry by bringing out the true position of Northern Ireland. Due regard must at the same time be paid to natural amenity, historic monuments and archaeological sites such as the one in the constituency of the hon. Member for Newry and Armagh (Mr. Nicholson) which I understand is to be the subject of a public inquiry.
I repeat that we cannot rest on our oars. I suppose that the fact that only 300,000 visitors come from Great Britain results from the concentration of our media on the killing and the violence. That figure compares with 350,000 from the Irish Republic. Tourism figures in the cross-border studies and co-operation with Bord Failte makes sense. I conclude by quoting Mr. De Valera, no less, who described Ulster as the province that every Irishman loves most next to his own.

Several Hon. Members: rose—

Mr. Deputy Speaker (Mr. Ernest Armstrong): Order. I am grateful for the co-operation of Members on both sides of the House. It may help the House if I say that the Minister is anxious to catch my eye at 11·15 pm, so I appeal for even more brevity.

Mr. Stuart Bell: I shall seek to follow your grave consign, Mr. Deputy Speaker. I shall limit my comments to one aspect of the Minister's opening remarks and not seek to equal the interesting, in-depth speeches of hon. Members who have gone before me.
I wish to deal briefly with the scrapping of the Lear Fan jet project, which the Minister described as disappointing


news. The Minister told the House that the 4·79 million dollars outstanding would not now have to be paid. Great effort has been made to distance this matter from the De Lorean affair, which was the subject of a previous debate, but it is right and proper that the House should also discuss the Lear Fan affair in some depth, and I shall seek to do so, albeit briefly.
The Lear Fan jet was to be made almost entirely of a lightweight carbon fibre, powered by two turbo-prop engines coupled to a single rear propellor and designed to fly at speeds of up to 400 mph using less fuel than some cars; but the project has now been scrapped. It is significant that the announcement of the decision came not from the Industrial Development Board but from Lear Fan Ltd. in Los Angeles. In a written answer to the hon. Member for Hazel Grove (Mr. Arnold) about the Lear Fan company's decision to cease trading, the Minister said:
I understand the directors took this decision because of continuing delays encountered in obtaining certification of the Lear Fan 2100 aircraft and the steep decline in the market for executive turbo-prop aircraft which had resulted in a serious deterioration of the long-term prospects of the company." —[Official Report, 3 June 1985; Vol. 80, c.86.]
 However, I suggest that the Lear Fan project collapsed because of the inability of Lear Fan to get an airworthiness certificate. Thus, the second reason given by the company is as redundant as those workers who are still at the plant in Carnmoney in Northern Ireland.
The Minister is to be congratulated on being forthright with the House in saying that £56·28 million had been lost to the Exchequer. Lord Lyell—whom the hon. Member for Antrim, North (Rev. Ian Paisley) described as being the Minister responsible for agriculture—referred to the losses in a statement that he made in the other place on 19 December 1984. He thought that the Government exposure was $24 million. That was obviously wishful thinking, because the proper figure given tonight by the Minister is £56·28 million.
As with the De Lorean affair, the Lear Fan issue raises a number of questions. Most of my questions relate to the administration of the former Minister of State, the present Minister of State for Defence Procurement, to whom I have given notice that I should be raising matters within his jurisdiction.
Why, in the first place, were the contracts for Lear Fan entered into in dollars, which meant that, with a strengthening dollar, the transaction across the exchanges cost us more than was necessary? Is it right that the Government should have used taxpayers’ money in dollars rather than in pounds? What chances are there of recovering as much as possible of the nearly £57 million that has been poured into the venture? Is it a fact, as stated in the press, that the Industrial Development Board's directors nominated to advise the Government recommended the Government to pull out of the Lear Fan project a year ago and to salvage what money could be recouped? If so, why was that advice not heeded?
Is it true that there is a legal possibility on the other side of the Atlantic that the Lear Fan company might be able somehow to close down the present operations, lose for the British Exchequer £57 million and open up again with other backers? In short, is it still thought that the Lear Fan jet is a marketable commodity?
I read that Mr. De Lorean is seeking to resurrect his car project in the United States and therefore, in a sense, begin

where he left off in Northern Ireland. I doubt whether that is so; and if I do not believe in miracles, I can believe in the gullibility of some people elsewhere in the world.
Why did the Government take a 5 per cent, equity stake in Fan Holdings Incorporated, which in turn owned Lear Fan Ltd.? What was the value of such a parsimonious holding? Why were the original interim loans waived in favour of royalty payments of up to $33·75 million?
We see here the shades of the De Lorean affair: a plan for a jet aircraft that had no prospect of obtaining an airworthiness certificate, yet the British Government bartered away taxpayers' money for royalty payments on an aeroplane that was destined never to fly.
Why was the original loan, which might have been recovered by the receiver in different circumstances, turned into a per capita employment grant to be secured against the achievement of the original Northern Ireland employment target of 1,250? By means of this debate I draw the attention of the receiver to the novelty of a situation in which a loan was to be converted into a grant on the achievement of an employment target of 1,250. That employment figure was never achieved, so £9·07 million could be recovered by the Exchequer.
Why did Her Majesty's Government waive their right to recover the original grant, and upon what financial criteria was this decision based? If additional assistance was to be linked to an increase in the number of employees above 1,250, why was that assistance given when there was no — I repeat no — increase in the number of employees above that figure? In fact, the number of workers employed on the Lear Fan project never rose above 560. If the Government had decided that no financial assistance should be provided unless it was linked to jobs, why did they agree to extend a bank guarantee totalling $15 million to 31 December 1986 and to provide additional public funds up to a maximum of $30 million in what they described as "a predetermined ratio with private sector money"? It was a question not of throwing good money after bad but of throwing good taxpayers' money after private investment capital and relying upon the judgment of the private investor to get it right. That is a matter that the Government and the Industrial Development Board ought to take on board. It is not sufficient simply to say that private money should be added to any particular project, because that, too, might not be backed up by expertise. Where was the expertise on carbon fibre, on aviation fuel consumption or on private jet market research? The British public are entitled to be told the criteria for such an investment.
I was as much surprised in this case as I was in the case of De Lorean to see who were the people who influenced the Government of the day. The greatest enthusiast for the scheme was the wife of the inventor. She had no financial, commercial or aircraft expertise that was worthy of the attention of the British taxpayer. Even Mrs. Lear had to confess in 1981 that the company was over its budget and behind schedule. What was the Government's response? They appointed a new chairman who was an independent oil operator and a banker from Denver, Colorado. Where was his aircraft expertise?
The Government announced that any new funding of the Lear Fan project was to be by way of a secured loan, the security being the premises in Northern Ireland which, in a sense, belonged to the taxpayer and which were meaningless in terms of collateral. Even then the


Government hinted that such a loan would be set off against further grants. These are all matters for the Public Accounts Committee, which looked very carefully into the De Lorean affair and threw light on a number of coiners that required light to be shed upon them. It must be the same here. Any analysis of this project shows clearly that there has been a waste of taxpayers’ money, a waste that has been brought about by Government incompetence, ignorance and mismanagement. The only good thing to be said is that it cannot be laid at the door of the present Minister, who was not in post at the time. But it can be laid at the door of the Government of whom he is a member.
If the Minister cannot be held responsible for the financial arrangements made by his predecessor in 1982, he does hold some responsibility for the wayward fashion in which announcements have been made concerning the cessation of trading of Lear Fan. The Opposition sometimes offer the Government a fair wind —to borrow a phrase from my right hon. Friend the Member for Islwyn (Mr. Kinnock)—if not an entirely bipartisan policy when we deal with Northern Ireland matters. But we categorically condemn the Government for the cavalier, inopportune and, quite frankly, callous way in which important announcements concerning employment are made out of this House, out of the reach of the probing questions of Members of Parliament, out of the reach of those who are seeking to do their duty by their constituents, by whom I mean those who live not only in Northern Ireland but in the United Kingdom as a whole.
The Minister touched briefly upon the closure of the gas industry in Northern Ireland. Perhaps, through the usual channels, there may be an opportunity to discuss that matter. But the announcement was made on a "Long Good Friday"—to borrow the title of a recent film— and we have not yet had the opportunity of a full debate on the whys and the wherefores.
The announcement of the collapse of the Lear Fan project was leaked in a Sunday newspaper over Whitsun, and followed by a response to a written question from the hon. Member for Hazel Grove. To his credit, the Minister sought to inject a new reality into the project with his statement on the Floor of the House on 19 December 1984, when he declared that with new money available from private sources he hoped that the original agreements would be implemented quickly so that the work in Northern Ireland factories could be restarted as soon as possible. The fact remains that £57 million of taxpayers’ money was poured into a project that was to yield not an aircraft manufacturing plant in Northern Ireland, but a plant to manufacture component parts. The real essence of the whole investment was that the manufacturing was to be done in Reno, Nevada.
I associate myself with the Minister's statement tonight — which he also made in response to the written question — and the statement of the hon. Member for Antrim, North that there is no reflection on the work force in Northern Ireland. There is nothing wrong with that work force. Like their counterparts on the mainland, they have lost their jobs, in one sense through clumsiness and incompetence, while those on the mainland have lost their jobs through the ideological bludgeoning of the Government. They have been

exemplary in their standards of work and in their loyalty to their project. But loyalty, like patriotism, is not enough.
While conceding that it was a high-risk venture, little comfort can be garnered from the Minister's words that, had it succeeded, it would have contributed greatly to employment in and the economy of Northern Ireland. We all wish such projects well, but we must be alert to the dangers. It is that alertness that no doubt prompted my predecessor, my hon. Friend the Member for Hammersmith (Mr. Soley), to ask the former Minister to
give a clear assurance that the Government are fully satisfied that they are getting all the information they need, especially of a technical and financial nature, to enable them to judge the future prospects of the company as well as the aircraft?" 
The Minister responded:
Yes. The financial and technical monitoring exercises that have been carried out are satisfactory. We are getting all the information that we need."—[Official Report, 23 February 1984; Vol. 54, c. 968.]
I doubt whether that information was available, and whether the Ministers and officials whose salaries we shall be voting tonight knew the difference between anhedral and dihedral wings.
Who checked out whether the Federal Aviation Administration would even give an air worthiness certificate because of the new technology involved? Who analysed the priorities of the Lear Fan company from a commercial standpoint and perceived that they were wrong, first, to get the certification, secondly, to produce the jet, and, thirdly, to market it? The potential market for an eight-seater private jet should have been tested and known and the prospects of getting an air worthiness certificate should have been thoroughly assessed before the taxpayer put even his financial little toe into the water.
The high risk lay in the fact that the aircraft was unlikely to receive, and has not received, an air worthiness certificate. One has to draw the parallel with De Lorean in that the same receiver is being used as in that case. His first duty is to secure the fixed and floating charge on the company's assets in Northern Ireland, and his second is to represent the Government's interests in the assets and technology of the Lear Fan company in the United States.
As we debate this order, we call into question not the Government's good faith, but their competence. They were singularly incompetent in the handling of the Lear Fan proposal, and they have done the taxpayer a disservice in the way that they have approached a technical problem, which should have been examined in much more depth.
Though the mills of God grind slowly, yet they grind
exceeding small; Though with patience He stands waiting, with
exactness grinds He all.
In the cases of De Lorean and of Lear Fan, He has ground exceedingly small and revealed the great difficulties and weaknesses in Northern Ireland for those who were looking for high investment and technology with little success.
I have taken on board the Minister's remark that two thirds of the work that had come to Northern Ireland had come from firms outside the Province, but that is no excuse for the incompetence with which this matter has been handled. It should be noted by the House, and no doubt it will be noted by the country.

Appropriation (Northern Ireland)

Rev. William McCrea: If there is a Division, we shall be voting for money coming to Northern Ireland. We believe that money is needed for agriculture, housing, jobs, roads and education. We also do not like direct rule. We want a fully devolved Government and Parliament in Northern Ireland, and the full democratic process honoured. That is shown by the fact that in the short time that we have tonight, we have to deal with such a wide range of matters that seriously affect the lives of the peoples of Northern Ireland.

Mr. Peter Robinson: Does my hon. Friend accept that we want one other thing in Northern Ireland — decent local government? Recently, however, we have seen the introduction into local government in Northern Ireland of the mouthpieces for murder and mayhem in our society. Will my hon. Friend ask the Minister what his response will be to the introduction of Sinn Fein chairmen?

Rev. William McCrea: I thank my hon. Friend for his intervention. Over the past few hours even the Minister may have realised that there are members of councils in Northern Ireland who will not welcome Sinn Fein, who will not let this pass easily and who will not allow it to be a one-night or a one-afternoon wonder. The hon. Member for Bath (Mr. Patten) will find that there are still in Northern Ireland Unionists worthy of that name and of the heritage that they thank God for.
My hon. Friend the Member for Antrim, North (Rev. Ian Paisley) has already mentioned councils. Unionists will not socialise with Sinn Fein, nor will they be used in any way to keep going a system which allows not only the representatives of murderers but murderers themselves to be councillors. If the Government think that we will sit down and look across at Sinn Fein councillors while they measure us up for coffins, they have another think coming. I have no intention of sitting there to be measured up for a coffin by any gunman of the IRA. Ulster needs good local government. Decent local government was destroyed when Sinn Fein councillors were allowed through the doors of the council chambers.
I come from a large agricultural constituency. I hope that for a change the Minister will give us some good news tonight for that industry. Lord Lyell told us that he had sympathy for our farmers. When the bank manager wags his finger to call a farmer into the bank, Lord Lyell's sympathy does not go far. We want more than sympathy. My hon. Friend the Member for Antrim, North mentioned the £7 million that is there to help them out. The Minister should tell us how that money will be given to Northern Ireland farming and agriculture.
The Minister of State has recognised the upward trend of unemployment in Northern Ireland; I think he genuinely appreciates the seriousness of the problem. I come from a constituency that has, the highest unemployment rate in the whole of the United Kingdom. What hope can the Minister give to my constituents in Mid-Ulster? What message can I take back to them concerning future employment? I want viable employment and genuine jobs. I do not want fly-by-nights. I do not want those who come in like De Lorean to use the British taxpayer and the

United Kingdom and then disappear. Has the Minister any announcements to make about jobs for my Mid-Ulster constituents? I hope to get an answer to that question concerning the future well-being of my constituents.
Class III, vote 2, deals with expenditure by the Department of Economic Development on subsidies to electricity tariffs. May I draw the attention of the Minister once again to the unbearable burden on Northern Ireland industry, which is disadvantaged because the electricity tariff is pegged to the highest in England. There is a need for a fairer pegging of electricity tariffs to assist industry in the creation of jobs.
Class V deals with roads. I accept that Northern Ireland had some of the best road systems in the United Kingdom, but the roads are now in a deplorable state. What is to be done?
The Castledawson bypass issue may be a hardy annual, but the sooner the Minister moves the sooner the problem will disappear. I should be more than delighted to be able to forget about it and move on to the next town.
What about the Moneymore-Magherafelt road? The Minister promised to see whether works could be completed to make the road safer.
I have written to the Minister about Orlit housing. When will the legislation come into operation? When will the Housing Executive be able to buy back those houses and give the people their money?
The Watson park bungalows are also causing worry because they are still defective after money has been spent on them. I wrote to the Minister asking him to put in writing that his chief officers in the Northern Ireland Housing Executive are sure the money already spent is well spent. I fear that the money will be poured down the drain, as it was with De Lorean and Lear Fan. That will not solve the problem and the people will be left in an intolerable position after they have been moved out of their houses three or four times.
When shall I be able to close the file on the case of Mr. Crozier from Cookstown? I shall be happy to give the Minister my file on the case so that he can sift through it. I have written to the Prime Minister, to the Secretary of State, to Lord Hailsham and to the Under-Secretary of State for Northern Ireland. Mr. Crozier is to be given a pension for health reasons, but no one will provide the health reasons. All he wants is to be told why he is being pensioned off on health grounds; then he will take the pension. I do not want another letter saying, "We have nothing more to add", or, "I am sorry, the case has been looked at before, we have nothing more to say." I want an answer.
Fundamental changes are proposed in health and social service benefits. The Prime Minister has failed to tell the Leader of the Opposition what figures can be applied to the suggested benefits. Perhaps the Minister will disclose them to his hon. Friends from Northern Ireland who can pass them on to the Leader of the Opposition and our constituents.

Mr. Ken Maginnis: I intervene, I must admit, as a protest at the length of time available for debate tonight. I do not intend to hold back the hon. Member for Bath (Mr. Patten) from replying to the debate. I am frustrated because this is the third time in succession that I have sat through debates. Two debates ago, I got about three minutes, I was not called on the last


occasion, and I assure the House that at one minute before quarter past eleven there is not adequate time for me to deal with the problems of my constituents in Fermanagh and South Tyrone and the difficulties that hon. Members representing Northern Ireland face under direct rule in trying to serve our constituents.

The Parliamentary Under-Secretary of State for Northern Ireland (Mr. Chris Patten): It is a pleasure once again to wind up an appropriation order debate which, as is customary, travelled far and wide, albeit, as the hon. Member for Fermanagh and South Tyrone (Mr. Maginnis) indicated, for a rather shorter period than has sometimes been our good fortune.
I wish to try with the minimum of fuss to answer the main points raised in the debate. Any issues that I am not able to cover in the course of these necessarily abbreviated remarks I or my hon. Friends will follow up in correspondence with the hon. Gentlemen who raised them.
The hon. Member for Newry and Armagh (Mr. Nicholson) raised two substantive issues about housing. He spoke first—and this point was touched on by other hon. Gentlemen — about renovation grants, and in particular about the delays experienced by his constituents in receiving them. I am conscious that there has been criticism of the Housing Executive administration of the renovation grant scheme, but I know that the executive is keen to improve its performance as much as it can. It is important to note that in the year ended 31 December 1983 almost 27,000 improvement, conversion, intermediate and repairs grants were approved, and grant was paid in just over 24,000 cases. These figures increased to almost 32,000 and 27,000 respectively in 1984, illustrating the scale of the grants operation. While there was a backlog of grants applications which reached 8,400 in March 1984, this has now fallen back to just under 3,000. This situation arose from the substantial increase in demand for grant aid resulting from the 1983 housing order, which widened the scope of the renovation grant scheme in a number of respects. While I am satisfied with the steps taken to reduce delays in the processing of grant applications, I shall continue to keep the executive's performance in this area under review.

Mr. Maginnis: I am grateful to the hon. Gentleman for giving way, because this is one topic on which I wanted to spend some time tonight.
I hope that the Minister recalls the letter that he sent me on 24 February 1984 after I wrote to him about the possibility of ensuring that grants were paid to those people who were most in need, stating that this perennial difficulty of excessive demolition was preventing the most needy people from getting grants for houses. He told me that the 1979 house condition survey was out of date and that there would be a new house condition survey shortly. That was over a year ago. That house condition survey I have not seen, but I have heard that the contents prove that the single unfits, as they are known, are as numerous as they have ever been, and we have not even begun to scrape the surface. Would the hon. Gentleman comment on that?

Mr. Patten: I am glad to have the opportunity to do so. The house condition survey will be published shortly. The hon. Gentleman is correct to say that one of the matters that it has shown clearly is that, while we have

made considerable progress in reducing unfitness, we have an increasing problem of disrepair. That has led me to feel even more strongly than I did when I replied to the hon. Gentleman last year that we have to look at the whole of our renovation grant aid to make sure that it is directed towards those people who are in greatest need and to properties that most need assistance. Therefore, I have set up a small committee composed of officials of my Department and of the Housing Executive which is looking at how we can target grant aid more effectively within the existing legislative framework. I hope very much that we shall have proposals to discuss with hon. Members before too long. The point made by the: hon. Member for Fermanagh and South Tyrone is extremely important, and I hope that we shall be able to demonstrate that we are responding to it in good faith as soon as may be.
The hon. Member for Newry and Armagh also referred to Orlit dwellings and asked for greater speed in dealing with the Housing Executive stock of Orlits. The hon. Gentleman may be aware that the Housing Executive is already considering the options for individual estates following its technical investigations. Announcements will be made by the executive on an estate-by-estate basis as soon as possible after consultation with the tenants. I know that the executive is fully seized of the need to take action as quickly as possible.
The hon. Gentleman asked me to consider the sale of Orlit dwellings to tenants at a cost reflecting their condition. I shall look at that proposal, but I wonder whether the hon. Gentleman would see very much advantage for the tenant in becoming the owner of a dwelling which in some cases could have a life span of only five to 10 years without expensive remedial action.
The hon. Member for Mid-Ulster (Rev. William McCrea) asked about legislation to bring the position in Northern Ireland into line with that in Great Britain. We had slightly more difficulty than we anticipated in drafting the legislation. However, I hope that we shall be able to lay an order before the House very soon. In the meantime, as I have made clear time and again, any special hardship cases will be dealt with, as two have already, on an administrative basis. If the hon. Gentleman has other similar cases, I should be more than happy to consider them.
The hon. Member for Newry and Armagh asked about a number of agricultural matters, beginning with the shortage of cold storage facilities for intervention beef. He knows about my status as a tyro in these matters, but I can say that we are aware of the potential difficulties arising from limitations on freezing and storage capacity for intervention beef, and we have arranged for a study to be undertaken on the facilities available, the current incentives, the employment prospects, the future needs and how they might be met.
The hon. Member for Antrim, North (Rev. Ian Paisley), the hon. Member for Newry and Armagh, the hon. Member for Mid-Ulster and others mentioned, quite understandably, their concern about milk quotas. They spoke of the special difficulties facing the Northern Ireland dairy industry. I can assure the House that we are doing all we can to achieve the maximum possible relief for the Province's milk farmers. We accept that without additional quota for Northern Ireland, individual producers may find themselves in difficulties. The very low uptake under the outgoers scheme was most


unfortunate and, as my hon. Friend the Member for Brent, North (Dr. Boyson) said, we are continuing to seek a solution to the problem. As the hon. Member for Antrim, North asked, I shall convey the concern expressed by hon. Members to my noble Friend who is responsible for these matters in Northern Ireland and also to the Secretary of State.
The hon. Member for Antrim, North referred in the context of Lear Fan to Ulster workmanship. He was entirely right to say that it is second to none, as the success of Harland and Wolff, Shorts and many other companies has made clear.
The hon. Gentleman also asked about the future of Ballintoy harbour, which I enjoyed visiting with him on one memorable occasion when the sun shone, as it always does on the righteous. I shall look into the latest state of of play on Ballintoy and write to the hon. Gentleman about it.
The hon. Member for Antrim, North referred to the arguments for a regional library, and protested about the recent decision that the Belfast central library should not become a regional reference facility independent of the Belfast Education and Library Board. There is not the necessary support from the boards for such a change to the existing arrangements. They are apparently largely content with the provision under existing legislation enabling all boards to take advantage of the services provided by the Belfast central library.
The hon. Gentleman referred to the extent to which Carson's monument is turning green. My hon. Friend the Member for Belfast, East (Mr. Robinson) understandably raised that point. I have nothing to add to what I have already said to my hon. Friend, but I note the importance that the hon. Gentleman properly attaches to the cleaning of that statue.
The hon. Gentleman and the hon. Member for Mid-Ulster referred to the position in local government following the elections. I should like to make it clear again, as I did in a series of radio, television and newspaper interviews yesterday, that there has been and will be no change in the Government's policy towards Sinn Fein. No reasonable construction of my remarks yesterday could conceivably suggest that there would be. Finally, as the right hon. Member for Strangford (Mr. Taylor) said in a series of letters to newspapers, I hope that hon. Members will keep the electoral failures and successes of Sinn Fein in perspective. It did worse in the local elections than in the European elections or the general election, and considerably worse in the local government elections than three out of the four main constitutional parties.
The right hon. Member for South Down (Mr. Powell) asked me to give him an undertaking about scallop beds. He referred to the fisheries close to the coast of Northern Ireland. I reiterate the assurances given by my hon. Friend the Member for Brent, North in his opening speech, that the fisheries are closely monitored. If there is any evidence of their stocks being endangered, steps will be taken to have the beds closed. I hope that the right hon. Gentleman finds that assurance satisfactory.
The right hon. Gentleman asked about waste disposal and the relative responsibilities of district councils and my Department. As he knows, district councils have the statutory responsibility for the development of a waste disposal strategy for their areas. The identification and

preparation of suitable sites is not a matter in which I can intervene. However, my Department is actively involved with district councils about waste management. We shall assist where possible. The right hon. Gentleman made some valuable suggestions about the extent to which we should take a greater lead in co-ordinating the various tasks of district councils in this respect, and I shall certainly come back to him on that point as positively as possible.
My hon. Friend the Member for Epping Forest (Sir J. Biggs-Davison), whom we always welcome to our debates, referred to the welcome increase in recent years in the number of extremely wise and perceptive holidaymakers, who come to Northern Ireland, and to the increased number of hon. Members who visit the Province, which is also to be welcomed. My hon. Friend will be pleased to know that my hon. Friend the Minister of State will shortly be chairing a conference on tourism to see how we can attract even more tourists to our shores.
The hon. Member for Middlesbrough (Mr. Bell), in a thoughtful speech, asked many detailed and serious questions about Lear Fan, which he will not expect me to answer during the next 60 seconds. However, they will be answered in due course in as full and open a way as possible—in other words in the fashion for which my hon. Friend the Minister of State is well known and respected.
I believe that I have answered most of the main points raised in the debate. I repeat that any detailed points will be answered in subsequent correspondence. This appropriation order shows once again that the Government are attempting to grapple with the extremely difficult problems of Northern Ireland in a reasonable and imaginative way, with a fair and reasonable allocation of public expenditure to support our policies and objectives. I trust that that will also be the view of the House.

Question put:—

The House divided: Ayes 133, Noes 5.

Division No. 229]
[11.30 pm


AYES


Alexander, Richard
Cranborne, Viscount


Amess, David
Dorrell, Stephen


Ancram, Michael
Emery, Sir Peter


Arnold, Tom
Evennett, David


Ashby, David
Fallen, Michael


Baker, Nicholas (N Dorset)
Fenner, Mrs Peggy


Baldry, Tony
Forsyth, Michael (Stirling)


Beith, A. J.
Fox, Marcus


Bellingham, Henry
Fraser, Peter (Angus East)


Biggs-Davison, Sir John
Garel-Jones, Tristan


Blackburn, John
Gregory, Conal


Bottomley, Peter
Hamilton, Hon A. (Epsom)


Bottomley, Mrs Virginia
Hampson, Dr Keith


Bowden, Gerald (Dulwich)
Hargreaves, Kenneth


Boyson, Dr Rhodes
Harris, David


Bright, Graham
Haselhurst, Alan


Brinton, Tim
Hayes, J.


Brown, M. (Brigg &amp; Cl'thpes)
Heathcoat-Amory, David


Bruinvels, Peter
Hicks, Robert


Burt, Alistair
Hind, Kenneth


Butcher, John
Hunt, David (Wirral)


Butterfill, John
Jones, Gwilym (Cardiff N)


Carttiss, Michael
Knowles, Michael


Channon, Rt Hon Paul
Knox, David


Chope, Christopher
Lang, Ian


Clarke, Rt Hon K. (Rushcliffe)
Lennox-Boyd, Hon Mark


Clegg, Sir Walter
Lester, Jim


Conway, Derek
Lightbown, David


Coombs, Simon
Lilley, Peter


Cope, John
Lord, Michael






Lyell, Nicholas
Shaw, Sir Michael (Scarb')


McCrea. Rev William
Shelton, William (Streatham)


Maclean, David John
Shepherd, Colin (Hereford)


McQuarrie, Albert
Silvester, Fred


Major, John
Skeet, T. H. H.


Mather, Carol
Spencer, Derek


Mayhew, Sir Patrick
Spicer, Jim (W Dorset)


Mellor, David
Stanbrook, Ivor


Merchant, Piers
Stern, Michael


Meyer, Sir Anthony
Stevens, Lewis (Nuneaton)


Miller, Hal (B'grove)
Stevens, Martin (Fulham)


Mills, lain (Meriden)
Stewart, Allan (Eastwood)


Mitchell, David (NW Hants)
Stewart, Andrew (Sherwood)


Morris, M. (N'hampton, S)
Stradling Thomas, J.


Murphy, Christopher
Sumberg, David


Neale, Gerrard
Terlezki, Stefan


Neubert, Michael
Thompson, Donald (Calder V)


Nicholls, Patrick
Thompson, Patrick (N'ich N)


Morris, Steven
Thurnham, Peter


Oppenheim, Phillip
Tracey, Richard


Ottaway, Richard
Twinn, Dr Ian


Paisley, Rev Ian
Walden, George


Patten, Christopher (Bath)
Waller, Gary


Pawsey, James
Wardle, C. (Bexhill)


Peacock, Mrs Elizabeth
Watson, John


Penhaligon, David
Watts, John


Percival, Rt Hon Sir Ian
Wells, Bowen (Hertford)


Portillo, Michael
Wheeler, John


Powell, William (Corby)
Whitfield, John


Powley, John
Winterton, Mrs Ann


Proctor, K. Harvey
Winterton, Nicholas


Rhodes James, Robert
Wolfson, Mark


Rhys Williams, Sir Brandon
Wood, Timothy


Robinson, Mark (N'port W)
Yeo, Tim


Robinson, P. (Be/fast E)



Roe, Mrs Marion
Tellers for the Ayes:


Rumbold, Mrs Angela
Mr. Peter Lloyd and


Sainsbury, Hon Timothy
Mr. Tony Durant.


Sayeed, Jonathan





NOES


McCusker, Harold



Molyneaux, Rt Hon James
Tellers for the Noes:


Nicholson, J.
Mr. William Ross and


Powell, Rt Hon J. E. (S Down)
Mr. Ken Maginnis


Walker,Cecil (BeIfast N)

Question accordingly agreed to.

Resolved,

That the draft Appropriation (No. 2) (Northern Ireland) Order 1985, which was laid before this House on 8th May, be
approved.

Manchester Steel Ltd. (Closure)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Major.]

Mr. Robert Litherland: I have chosen this subject for the Adjournment debate to give some of the facts about the context within which the Manchester Steel closure decision should be seen. Why is the closure of Manchester Steel Ltd. so exceptional? It is not just another isolated set of redundancies, because we have had such closures and redundancies in the past. The gradual decline in manufacturing goes back over a long period to the mid-1960s. In recent years the position has deteriorated rapidly, to such an extent that east Manchester has been ravaged by closures and redundancies.
How dramatically the situation has changed. East Manchester, once the workshop of the world with its expanding and prosperous light and heavy engineering industry, coal mining, chemical firms and textiles businesses, is barely recognisable now, with its deserted factories bearing witness to the changed fortunes of that part of Manchester.
In 1978, manufacturing employment accounted for some 63 per cent, of jobs in the area. Since then, job losses in manufacturing in east Manchester have become far more dramatic. Between 1979 and 1983, 12 firms employing more than 100 people have closed. They include Laurence Scott with 650 employees; Richard Johnson and Nephew with 610 employees; Easicut tools with 350 employees; Walkden and Makin with 270 and more recently GEC Switchgear has announced that it will be shedding about 270 jobs from its Openshaw factory.
Between 1971 and 1985, 20,000 jobs have been lost in east Manchester and the redundancies between 1981 and 1984 account for about 4,500 jobs. With such job losses the social impact has been catastrophic. Until 1980, unemployment in that part of the city compared with the national average. The effect of the closures and redundancies in east Manchester has resulted in the unemployment rate almost doubling between 1980 and 1981.
The environmental consequences of those changes can be seen in the vacant, under-used land and buildings and the unattractive image that that gives the area. Nearly one quarter of the industrial land in east Manchester is now vacant. Manchester city council, through its east Manchester initiative, has taken steps to try to remedy the situation and to date some £8 million has been spent on acquiring land and buildings to carry out demolition, but more funding will be required by the city council. It has pressed the case for funds to be made available on a more regularly programmed basis, arguing that £10 million is needed over the next three years to reclaim derelict land and buildings.
Every closure adds to the enormity of the problem, and now we have Manchester Steel. It is part of the process of losing manufacturing in east Manchester. It is another nail in the coffin of this once vibrant working area and another attack on workers who have the skill and the will to work, but who are having their pride torn from them by a notice of closure which says that they are expendable and are no longer required. To add insult to injury, the decision to close Manchester Steel was taken in secret, behind closed doors in a foreign country. The company was owned by


Elkem of Norway and discussions had been taking place for nine months and the news broke through a leak of information.
In 1982, the unions and the management, assisted by the city council, had combined to save the firm. The workers were left in the dark about what was taking place. Their thanks was no consultation but merely a statement of the cold hard facts that Manchester Steel in my constituency and the Bidston plants on Merseyside were to close. Elkem acted in a dishonourable and underhand way.
What about the Government's attitude? Hiding behind the smokescreen of commercial confidentiality and not being prepared to intervene in a free market commercial transaction, they did nothing. In doing nothing, the Government acquiesced to the takeover by Allied Steel and Wire, which is owned by British Steel and GKN.
We have the ridiculous situation of workers paying their taxes, and money from those taxes being allocated to Allied Steel which uses it to allow foreign firms to sell their steel involvement in the United Kingdom, and the plants are shut. How nice and convenient for the Government and their rationalisation programme.
When a deputation from Manchester Steel met the Under-Secretary of State for Trade and Industry, he professed not to know that negotiations for the takeover were under way. Yet the takeover was being considered by the Commission of the European Community. A press release of 20 May said:
The Commission has authorised Allied Steel and Wire Holdings Ltd … to acquire the entire share capital of Manchester Steel Ltd … under article 66 of the ECSC Treaty." 
In a conversation with Mr. Keith Donoghue, who made the decision on Manchester Steel, the local MEP, Mr. Eddy Newman, was told that those consulted included the Department of Trade and Industry, which not only gave its authorisation, but pointed out to the ECSC that the takeover would suit the development of the steel industry. Who is running this country? Are diktats coming from the European Community?
To the workers, terminology such as "rationalisation" means extinction. They can see the effects on the lives of their families, on the suppliers to Manchester Steel, on services dependent on the purchasing power of the money earned by Manchester Steel workers, on the local shops, pubs and clubs and on home service suppliers. They recognise that the closure creates fears for job security elsewhere.
More families will go on to supplementary and housing benefit, and there will be more mental strain from unemployment. I was told that there were four suicides after the closure of Richard Johnson and Nephew, which had been in existence for 200 years before it was bought by a South African consortium and closed within 18 months. The locks were on the gates when the workers returned to the plant.
There will be family breakdowns and more referrals to health and welfare services. Because of what is happening to the workers and their families and to the area where they live, they will fight the closure to the bitter end. I know these workers and I represent the area. They have my fullest support and they are supported by their union and the community, which is sick and tired of the relentless attack on its living standards. The workers have the

support of all Labour Members in the Manchester area. I received a letter today from my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) expressing his support. In addition, my hon. Friend the Member for Birkenhead (Mr. Field) will be speaking in the debate.
I have spoken of the local interest, but what about the national interest? In their submission to the Office of Fair Trading the solicitors acting for the Amalgamated Association of Wiredrawers and Kindred Workers state:
There are a number of reasons why our clients believe that this transaction would be against the national interest. In effect it would concentrate the production of 5·5 to 13·5 mm rod in the hands of one company alone in the United Kingdom. It should be noted also that Manchester Steel is the sole manufacturer, in the country, of 100 to 110 mm concast billet for re-rolling, in the main. These observations touch the surface only of a potentially serious situation and it is our clients' wish, through us, to forumulate a detailed complaint supported by evidence.
The evidence is that Manchester Steel is the only independent manufacturer of 100 mm billet selling its products on the market, as British Steel at Scunthorpe ceased production of 100 mm billet about two months ago. There is an increasing demand for this product but also a shortage. If manufacture was in the hands of Allied Steel alone, the re-rollers would have to purchase from that company or import the product, so Allied Steel would be in a position to control both the supply and the price. We believe that the matter should be referred to the Monopolies and Mergers Commission, because if Manchester Steel ceased production Allied Steel would become the major source of supply.
Many independent wiredrawers obtain their rod requirements from Manchester Steel. Closure would mean that they would have to purchase their requirements from Allied Steel and would have to pay "the price". The alternative for both wiredrawers and reinforcement engineers would be imports.
The Manchester and Bidston rolling mills are flexible and produce small quantities with relatively short lead times, an essential service to many of the small independent wiredrawers. That facility to the market would be lost if Manchester Steel was closed. Allied Steel is not geared to that degree of flexibility. Furthermore, its own downstream interests are in direct competition with the small independent companies to which I have referred.
The Manchester Steel plants are modern. A great deal of finance was put into refurbishing the plant in my constituency. The company has flexible working practices. Closure would leave less flexible plant to meet the market requirements.
The United Kingdom generates about 8 million tonnes of scrap per year, of which 4 million tonnes are exported, mainly to Spain. The scrap, converted to steel, is then exported to other countries, including the United Kingdom. If Manchester Steel closes, it is likely that much of the 500,000 tonnes of scrap used by that company would be exported and that some would return to this country as the finished product.
I believe that the observations made by the unions should receive consideration by the Monopolies and Mergers Commission. We insist upon that. The Government's replies to my questions are just not good enough. When I talk about the future of Manchester Steel I receive the bland reply that it is up to the new lords and


masters of the company to make the decisions. What part do the Government play? The diktats seem to come from Europe or from high finance somewhere while the Government just stand back and wash their hands of the problem as though they had no moral obligations in the matter.
The Government have a moral obligation to be helpful should any interest be shown by an organisation wishing to acquire Manchester Steel. It is understood that members of senior management of the company were instructed not to look for a bid in the open market. It would be in the interest of the nation in general and of east Manchester in particular if Manchester Steel survived. We want the Government to act before the situation becomes irretrievable.
When we talk about closures and so on, we are talking not simply about statistics and percentages: we are talking about people, human beings, whose only crime is a desire to work. The workers believe that Elkem has sold them out and that the Government have betrayed them. They are left wondering to whom to turn and what hope there is for them and their families. Most of them are youngsters with mortgages and other commitments. They see ahead a path of hopelessness. We want the Government now to say exactly where they stand on this issue and whether they have become allied to the takeover and closure of Manchester Steel.

Mr. Frank Field: I thank my hon. Friend the Member for Manchester, Central (Mr. Litherland) for initiating this debate and for permitting me to intervene. I do so because, as he explained, Manchester Steel also owned a plant in Birkenhead.
I wish to underline many of the points that my hon. Friend made, particularly the fact that Manchester and Birkenhead already suffer from massively high unemployment. In Bidston, in my constituency, the unemployment rate is in excess of 40 per cent. The mill in Birkenhead, like the one in Manchester, has turned the corner financially.
We are talking also about a takeover in both areas by a company, the main aim of which is to destroy rather than to promote jobs. We are speaking of a takeover bid of a company which, with full union support, has seen a major programme of modernisation and reform.
While I do not wish to deflect thought from the main thrust of my hon. Friend's main comments—particularly when he asked what the Government proposed to do in the present situation — I must comment on the role that Elkem has played in these proceedings. My hon. Friend noted that the negotiations to sell the company and to destroy so many jobs had been going on in secret for nine months.
This Norwegian company not only prides itself on having good industrial relations but it usually talks of worker involvement. However, when we consider Elkem's involvement in this matter, we see that it is not just a question of what is left to be desired but that practically everything is left to be desired about its behaviour. Elkem has behaved badly. It now has a moral responsibility to use its influence to ensure that as many jobs as possible, in Manchester and Birkenhead, are saved.
This is in some respects an unusual Adjournment debate. A number of Back-Bench Members are present,

as are two Ministers. I am sure that the Parliamentary Under-Secretary of State for Energy, who has taken a close interest in the future of the steel mill at Bidston, will be interested in what his hon. Friend the Parliamentary Under-Secretary of State for Trade and Industry has to say in replying to the debate.

12 midnight

The Parliamentary Under-Secretary of State for Trade and Industry (Mr. John Butcher): First, I thank the hon. Member for Manchester, Central (Mr. Litherland) raising this question. He has every right to do so, bearing in mind the dramatic impact that this closure is having upon his constituency and the unhappy history of unemployment in this sector of Manchester, to which he so vividly referred.
The hon. Member for Birkenhead (Mr. Field) drew attention to the fact that this is an unusual Adjournment debate because an unusually large number cf hon. Members are present. I acknowledge also the interest of my hon. Friend the Member for Bury, North (Mr. Burt) as the secretary of the north-west group of Conservative Members of Parliament. He has pursued his inquiries in correspondence with my hon. Friend the Minister of State. I hope to be able to answer all of the questions that have been asked.
As a matter of general principle, the Government recognise that the manufacturing sector in the United Kingdom produces a far higher proportion of internationally tradable goods than does the service sector. For that reason, I join the hon. Member for Manchester, Central in stating that we believe that this country's manufacturing sector is our prime generator of wealth and that this will always be the case. Therefore, we share he hon. Gentleman's concern that skills in the manufacturing sector should be used to the fullest possible extent. However, we are faced with some excruciating dilemmas in the steel industry, not only on a United Kingdom but on a European basis. I should therefore like to deal with that area of influence, because it is possible that the hon. Gentleman has confused one or two matters in that area.
I was able recently to gauge the depth of feeling of the hon. Gentleman and his constituents when I met a delegation of representatives of the work force from Manchester Steel. It was led by the hon. Members for Manchester, Central and for Birkenhead, whose constituency includes Manchester Steel's other plant at Bidston.
I propose to respond to the points that have been made under two broad headings: first, to make clear the Government's position on the proposed closure of Manchester Steel and to set it in the wider context of the problems faced by the steel industry, outlined by the hon. Member for Manchester, Central, and, secondly, to draw attention to the steps which the Government are taking to encourage job opportunities in Manchester.
I fully recognise the disappointment and frustration which must have been caused by the closure announce-ment, because the company had survived an earlier threat of closure in 1982. Manchester Steel remained in business at that time largely because the work force agreed to a cost reduction programme. That made their pain, in the light of the recent announcement, that much more difficult to bear.
Considerable improvements were made, but regrettably they have not been sufficient to persuade Elkem to retain the production facilities at Manchester and Bidston in the face of stagnant markets.
Many of the problems of the industry which existed in 1982 still remain. Depressed demand for steel products continues and substantial overcapacity exists, with consequential effects on efficiency and profitability. Other parts of the steel industry face the same difficulties, both here and throughout Europe.
Painful measures have had to be taken throughout the EC to stabilise the market, to restructure the industry, and to remove excess capacity. Behind those terms lie the social and human difficulties about which we have heard. This process has been difficult and has resulted in large-scale redundancies both here and on the continent. That point has been raised by my hon. Friend the Member for Wirral, West (Mr. Hunt) who is here this evening. But only by this means can an efficient and profitable industry be re-established, with reasonable hopes of longer-term job security for those remaining in the industry, although that is of no consolation to those who are the casualties of this process. In this context, it is estimated that in Manchester Steel's product area, capacity utilisation is between only 65 and 70 per cent. Much higher levels are needed for sustained profitability and viability.
The Government's position on further restructuring in the steel industry is quite clear. Where private sector firms, such as Allied Steel and Wire and Manchester Steel, are concerned, it is for the firms themselves to decide what rationalisation is necessary and what form it should take. The firms in the industry are best placed to know what measures are needed, and to take decisions based on their commercial judgment. It would be wrong for the Government to second-guess or seek to influence their plans.
The Government were therefore not involved in the commercial negotiations which led up to ASW buying Manchester Steel from Elkem. We were, however, kept in touch with developments on the usual commercially confidential basis by ASW.
There have been some suggestions that ASW is not a genuine private sector company because of the British Steel Corporation's major — now 48 per cent. — shareholding. Let me make it clear tht since ASW was set up as a joint venture between BSC and GKN in 1981, the Government have always regarded it very clearly as a private sector firm. It therefore makes its own commercial decisions without any need for Government approval, just like any other private sector business.
It has been suggested that even if the rolling operations were to close down steelmaking, the steelmaking aspect of Manchester Steel should be kept open because closure could cause problems in the supply of billets to British customers. I understand that ASW has deferred a decision about the future of the Openshaw billet furnace. No doubt it will take into account the market prospects before finalising its decision. But I would emphasise yet again that it is for the company to judge whether the retention of the facilities is viable.
Equally, if other steelmakers or steel buyers of those products wished to make proposals to ASW about supplies of billet, or the possible purchase of either of the steelmaking plants, they are free to do so. This is not a

matter for the Government, as the earlier negotiations were not, and it is for ASW to consider any proposals on their commercial merits. I understand that that is its precise attitude.
I turn now to the wider effects of the planned closure of Manchester Steel on the Manchester area, and north-east Manchester in particular. The Government recognise that this area has suffered considerably from the effects of industrial decline in recent years. Government policies as a whole, both in the steel industry and more widely, are designed to re-establish efficient and internationally competitive businesses. But success will not necessarily result in increased job opportunities in the same sectors as those where job losses have occurred in the past.
Against that background, the Government have ensured that considerable resources are directed to the Manchester area to alleviate the worst effects of industrial decline. As the hon. Gentleman will know, the Government made part of Manchester, including the north-east of the city, an assisted area last November. That means that the area now benefits from a number of schemes of support for industry which would not otherwise be available. These include regional selective assistance. Since assisted status was granted, the north-west regional office has received 18 firm inquiries about regional selective assistance from firms in north-east Manchester, of which one is currently at an advanced stage of appraisal. I very much hope that the number of good projects submitted for appraisal will increase.
North-east Manchester is also eligible for derelict land clearance grant, designed to assist the economic recovery of rundown areas by providing resources for clearing derelict sites. The sum of £600,000 was provided in 1984–85 for north-east Manchester to clear sites for industrial or residential development, or to improve housing conditions and community facilities. If the Openshaw plant were to close, it is possible that assistance under that scheme could be provided towards the clearance of the site.
North-east Manchester receives considerable help from the Department of the Environment's inner city policy. Three industrial improvement areas have been designated and the inner urban area of Manchester benefits from partnership area status — the highest designation under the urban programme. Since 1982, that has made available some £4 million of aid for 198 industrial and environmental improvement projects in Manchester.
Manchester is also the focus of one of five city action teams we launched in April. The teams' task will be to look at ways of helping east Manchester, through the combined schemes offered by my Department, the Department of the Environment and the Manpower Services Commission.
Through all these measures, the Government are doing a great deal to help the industrial base of north-east Manchester, and the job prospects of those who live there.
Tonight's debate has raised a number of very broad as well as understandably specific issues. I say to hon. Members on both sides of the House that the Government do not underestimate the social cost of these closures. Neither are we unsympathetic.
We are unanimous in condemning the unwelcome pressures that come from an increase in unemployment in any local community. But I am bound to say that, faced with that, we must look also at those other broader


industrial implications. We believe that there is a suite of policies available that will help us to address each side of this particularly difficult equation.
Question put and agreed to.
Adjourned accordingly at ten minutes past Twelve o'clock.